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For immediate release

17 August 2022

RESULTS ANNOUNCEMENT FOR THE FULL YEAR ENDED 30 JUNE 2022

Melbourne, Australia – CSL (ASX:CSL; USOTC:CSLLY)

As approved by the Board of CSL Limited, and in accordance with ASX Listing Rule 4.3A, please find attached the following for immediate release to the market:

Appendix 4E – Full Year Report;
Operating and Financial Review for the full year ended 30 June 2022, which accompanies the Directors’ Report;
Directors’ Report (including the Remuneration Report); and
Financial Report.

Authorised for lodgment by:

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Fiona Mead Company Secretary

For further information, please contact:

Investor Relations:

Bernard Ronchi Stephen McKeon Director, Investor Relations Director, Investor Relations CSL Limited CSL Limited Telephone: +61 3 9389 3470 Mobile +61 402 231 696 Email: [email protected] Email: [email protected]

Media:

Jimmy Baker Communications, CSL Limited Mobile +61 450 909 211 Email: [email protected]

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CSL Limited ABN: 99 051 588 348

ASX Full Year Information 30 June 2022

Lodged with the ASX under Listing Rule 4.3A.

Section	Page
Appendix 4E	3
Operating and Financial Review
- Chair Message	5
- CEO Message	7
- Our Company	11
- Our Strategy and Performance	20
- Our Material Risks	26
- Our Future Prospects	29
- Our Governance	31
Directors’ Report	46
-Remuneration Report	54
CSL Calendar	83
2022 Annual General Meeting	83
Financial Statements	84

Legal notice

This report is intended for global use.

This Report is a summary CSL’s operations and activities for the 12-month period ended 30 June 2022 and financial position as at 30 June 2022.

This report covers CSL’s global operations, including subsidiaries, unless otherwise noted. A reference to CSL, CSL Group, we, us and our and similar expressions refer collectively to CSL Limited and its related bodies corporate. Some statements about products, registered product indications or procedures may differ in certain countries. Therefore, always consult the country-specific product information, package leaflets or instructions for use. For more information, please contact a local CSL representative.

Brand names designated by a ® or a ™ throughout this publication are trademarks either owned by and/or licensed to CSL or its affiliates. Not all brands mentioned are used or registered as trade marks in all countries served by CSL.

Forward-looking statements

This report contains forward-looking statements including statements with respect to future company compliance and performance. This report also includes forward-looking statements regarding climate change and other environmental and energy transition scenarios. While these forward-looking statements reflect CSL’s expectations at the date of this report, they are not guarantees or predictions of future performance or statements of fact. These statements involve known and unknown risks and uncertainties. Many factors could cause the Group’s actual results, performances or achievements to differ, possibly materially, from those expressed in the forward-looking statements. These factors (including significant geopolitical issues relating to war in the Ukraine, supply chain disruptions, energy security and inflation) include changes in government and policy; actions of regulatory bodies and other governmental authorities such as changes in taxation or regulation (or approvals under regulation); the effect of economic conditions; technological developments in the healthcare field; advances in environmental protection processes; and uncertainty and disruption caused by the COVID-19 pandemic and geo-political developments. There are also limitations with respect to scenario analysis, and it is difficult to predict which, if any, of the scenarios might eventuate. Scenario analysis is not an indication of probable outcomes and relies on assumptions that may or may not prove to be correct or eventuate.

Readers are cautioned not to place undue reliance on forward-looking statements.

Except as required by applicable laws or regulations, CSL does not undertake to publicly update or review any forwardlooking statements. Past performance cannot be relied on as a guide to future performance.

CSL Limited

ABN: 99 051 588 348

Appendix 4E

Year Ended 30 June 2022

(Previous corresponding period: Year Ended 30 June 2021)

Results for Announcement to the Market

Results for Announcement to the Market
	2022	2021	Percentage
	US$m	US$m	change
Sales and service revenue	10,136.3	9,979.5	2 %
Total other revenue	425.6	330.5	29 %
Total revenue	10,561.9	10,310.0	2 %
Profit before income tax expense	2,779.6	2,963.1	(6) %
Income tax expense	(524.9)	(588.1)	11 %
Reported net profit from ordinary activities after tax attributable to
members of theparent entity	2,254.7	2,375.0	(5) %
Reported netprofit after tax attributable to members of theparent entity	2,254.7	2,375.0	(5) %

Reported

Total revenue up 2% to US$10.562 billion
Net profit after tax for the year attributable to members of the parent entity down 5% to US$2.255 billion

Underlying Net Profit after Tax at Constant Currency[1]

Underlying total revenue at constant currency up 3.5% to US$10.668 billion
Underlying net profit after tax for the year at constant currency down 6% to US$2.236 billion

Dividends

Dividends
	Amount per	Franked amount
	security	per security
		10% franked at
Final dividend (determined subsequent to balance date#)	US$1.18	30% tax rate*
Interim dividend (paid on 6 April 2022)	US$1.04	unfranked
		10% franked at
Final dividend (prioryear,paid on 30 September 2021)	US$1.18	30% tax rate

Record date for determining entitlements to the Final dividend: 7 September 2022

Under Australian law non-resident withholding tax is not payable on the unfranked component of this dividend as that portion will be declared to be wholly conduit foreign income.

1 Excludes the impact of foreign exchange movements in the period under review.

Explanation of results

For further explanation of the results please refer to the accompanying press release and “Operating and Financial Review” in the Directors’ report that is within the year report.

Other information required by Listing Rule 4.3A

The remainder of the information requiring disclosure to comply with Listing Rule 4.3A is contained in the attached Additional Information, Directors’ Report, Financial Report and media release.

Summary NPAT	US$m	Summary Revenue	US$m
Reported net profit after tax	2,254.7	Reported Revenue	10,561.9
CurrencyEffect	(19.1)	CurrencyEffect	105.7
Constant Currency Net Profit after Tax*	2,235.6	Constant Currency Revenue*	10,667.6

*Constant Currency Net Profit after Tax and Constant Currency Revenue have not been audited or reviewed in accordance with Australian Auditing Standards. Constant currency removes the impact of exchange rate movements to facilitate comparability of operational performance. The current period net profit of entities within the group that have reporting currencies or transactions other than US Dollars have been restated at the exchange rates that were applicable to the prior comparable period. Average exchange rates used for major currencies for the year ended 30 June 2022/30 June 2021 were as follows: USD/EUR (0.88/0.84), USD/AUD (1.37/1.35), USD/CHF (0.93/0.91), USD/CNY (6.44 /6.65) and USD/GBP (0.75/0.75).

Net Tangible Assets Backing

Net Tangible Assets Backing
		30	June	20223		30	June	2021
Net tangible assets backing per ordinarysecurity2	$			24.79	$			12.55

3 2 Excluding the effects of equity proceeds raised during the year for the acquisition of Vifor Pharma AG, the net tangible assets backing Net tangible assets include the right-of-use assets recognised under AASB 16 Leases per ordinary security at 30 June 2022 is $14.45.

Changes in controlled entities

The Group did not acquire or dispose of any entities during the year. Subsequent to the year ended 30 June 2022, the Group acquired Vifor Pharma AG (Vifor). See discussion regarding this acquisition below.

Acquisition of Vifor

The Group has received all necessary regulatory clearances and completed the acquisition of Vifor on 9 August 2022.

The Group now holds more than 98% of Vifor shares upon completion and will proceed with cancellation of the remaining publicly held Vifor shares, in accordance with Swiss takeover rules. CSL will also apply for the delisting of Vifor shares on the Swiss Exchange.

Audit report

The audit report is contained in the attached Financial Report.

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F Mead Company Secretary 16 August 2022

Chair Message

Dear Fellow Shareholders,

I am pleased to share our results and operating review for 2021/22, from which you will see that CSL, supported by the strength of its foundations and an agile approach, is poised to deliver sustainable growth to our stakeholders.

Poised for Growth

CSL has continued to be resilient to the external environment over the 2021/22 financial year. Our 2030 Strategy and our values continue to guide our leaders all the way through to our frontline employees.

Measured and ongoing investment into our business has been a key enabler of growth, and will continue to underpin that growth into the future. Our global capital investment program has advanced according to plan, and we continue to make great progress in our research and development (R&D) pipeline.

During the financial year, the Board approved the proposed acquisition of Vifor Pharma, a global pharmaceutical company focusing on the treatment areas of iron deficiency, dialysis, nephrology and rare disease. Through this acquisition, our global reach, R&D capabilities, and balance sheet will help accelerate opportunities to bring new and innovative products to the large and underserved community of people suffering with kidney disease and iron deficiencies.

The Board looks forward to the full integration of this business and we thank shareholders for their support for this acquisition.

Our Governance Priorities

Another way we ensure we are poised to take advantage of the many opportunities afforded to us is through rigorous, best-practice governance, which is always a major focus of the Board.

In line with an observed trend in many jurisdictions towards a tenure limit for audit firms, we completed a competitive tender process to appoint new external auditors. This appointment is subject to shareholder approval at CSL’s 2023 Annual General Meeting. If approved by shareholders, Deloitte Touche Tohmatsu will be CSL’s external auditor for the 2024 financial year (commencing 1 July 2023). We wish to thank EY for their many years of distinguished service to shareholders.

The composition of the Board is an ever-present priority. We aim to have the right skills and expertise to navigate our industry and the broader macro environment. We believe we have a strong and complementary dynamic that will continue our long track record of exceptional governance.

The return of our ability to travel has meant that the Board has been able to come together in person more often, and I particularly enjoyed visiting our Kankakee and Holly Springs facilities in the United States with my fellow Board members and meeting the dedicated teams working at those sites.

Last year we announced our new sustainability strategy. While this has always been a focus for us at both the Board and operational levels, I am pleased to say the new strategy has provided us a refreshed impetus to be clear about our sustainability priorities. You can read about our progress, and specifically for the environment, further in this document.

An Opportune Time

Although the global pandemic has entered a new phase, the operating environment continues to prove testing. Once again, I would like to thank our Managing Director and Chief Executive Officer, Paul Perreault, his Global Leadership Group and all of our CSL colleagues for successfully navigating your company through this challenging time.

There has been an overwhelming response to the pandemic from the scientific community, including CSL, and the many partners we engage with all over the world. Our partnership with AstraZeneca for example, manufactured 50 million doses of the VAXZEVRIA[®] COVID-19 vaccine requisitioned by the Australian Government. This enabled the protection of millions of Australians, as well as many of the country’s neighbours in the Pacific region.

While we hope that the pandemic challenge starts to fade, it is in the nature of our industry to look to the other problems we try to solve every day, and work out how we can approach them more effectively. These unmet medical needs are an opportunity for our people, from our scientists, researchers, knowledge workers, to our manufacturing experts and phlebotomists to contribute to helping protect the health of communities around the world. This pursuit has received a great boost over the past two years as we have witnessed new approaches to clinical trials, fast-tracked approval processes and new precedents for what collaboration can look like.

This is an opportune time for our company to meet the world’s increasing expectations, and our industry to heighten its contribution to achieving a healthier world.

Outlook

While I began this note expressing my optimism, I am always wary of the broader environment in which we operate. At the time of writing there are significant geopolitical issues relating to war in the Ukraine, supply chain disruptions, energy security, and inflation.

There are no quick fixes to many of these issues, but the vital nature of the products and treatments that CSL produces means we can factor in a level of confidence to our growth plan.

I can assure you that we will work to control what is within our control with the people who rely on our vaccines and therapies as our priority. As always, in doing so we will continue to strive to create value for shareholders. I am pleased to report that the total full year dividend per share is US$2.22 per share, which is held constant with the previous financial year.

Thank you for your ongoing support of our company.

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Brian McNamee AO Chair

CEO Message

Dear Shareholders,

I am pleased to be addressing you after another year when CSL was able to deliver solid results, as promised, in an ongoing complex global environment.

As I move around and connect with our people, patients and donors, I have been reminded repeatedly that when we trust in science and our purpose, the reward is repaid many times over, and allows us to continue delivering our promises to our stakeholders.

Culture is Key

Whilst science has firmly and rightly been in the spotlight through the pandemic, progress in this domain does not happen without talented people.

As our people continue to connect both virtually and in person across plasma centres, our manufacturing sites, our research labs and our offices, there are many conversations within and between the diverse teams of people who make CSL so successful. The common thread I hear is that, although life has changed, our people stay motivated dayto-day through an overwhelming dedication to our purpose and our values.

Together, these have driven a culture that is not easily replicable, and one that I truly believe is unique and enduring at CSL.

The science and people of CSL save lives, and it is important to our leaders that employees feel motivated and proud to come to work, and that they have a promising future with us. This priority has been acknowledged this year with CSL honoured to be recognised as one of Australia and New Zealand’s best places to work by the Australian Financial Review . In March, Forbes magazine also named CSL among America’s Best Employers for 2022. It is encouraging to see that we are making progress and are receiving recognition for our efforts.

Executing on Our 2030 Strategy

CSL’s strategic framework guides us in how we make considered strategic decisions to evolve our organisation so that it remains effective, sustainable and efficient.

Our priority areas are: people and culture, focus, innovation, efficiency and supply, sustainable growth and digital transformation. You can read more about these in detail on page 20 of this report, but I want to reiterate that we are executing to plan and I am pleased with the progress we’ve made so far, particularly in relation to setting emissions reduction targets.

I would also like to elaborate on Dr McNamee’s comments regarding Vifor Pharma. In December, we were pleased to enter into an agreement to acquire Vifor Pharma, a global specialty pharmaceutical company with leadership in renal disease and iron deficiency.

The acquisition fits strongly with our strategy. It adds a durable and growing business with leadership positions across nephrology, dialysis and iron deficiency, and will provide a platform to build a significant renal franchise. It also extends the reach of CSL’s highvalue pipeline in the renal space by leveraging enhanced access to unique patient populations which will support clinical trial execution.

The acquisition was funded through an institutional placement, a share purchase plan and a debt raising and I would like to thank all of our stakeholders for the overwhelming support they have shown for the transaction. Now, we look forward to the important work of integrating this business into the CSL family and driving the sustainable growth that this acquisition will add to the CSL business.

Investment and Innovation

In 2021/22, CSL increased its investment into research and development by 17% at constant currency.

Enduring organisations have many high-value capital allocation options; initiatives to invest in that will help the organisation prosper into the future. Optionality is a good problem to have, and one that our leadership group debates regularly.

While these can take years to realise, it is great to share the achievement when we do. One recent example was the completion of the US$156 million expansion of our CSL Seqirus manufacturing facility in Holly Springs, North Carolina in the US. This new fill and finish production line gives us the ability to streamline our production process more efficiently, which ultimately helps us to better meet the needs of our patients and, in turn, better meet the needs of public health. CSL Seqirus’ new A$800+ million cell culture vaccine production facility in Tullamarine is also making good progress and when finished (expected to be in 2026) will be the only one of its kind in the Southern Hemisphere.

Our R&D pipeline is at the heart of future therapies and our investment in our R&D infrastructure is significant. Construction of our new R&D campus in Marburg, Germany, is nearly complete and this building will have capacity to house about 500 R&D employees, who will form strong, collaborative linkages with our other R&D campuses around the world.

In Melbourne, Australia, our state-of-the-art global R&D campus and new corporate headquarters under construction in Parkville’s biomedical precinct are well advanced, with plans for completion in early 2023.

We have also made good progress in our investment into our late-stage R&D pipeline. In May, we received notice that the US Food and Drug Administration had accepted our Biologics License Application, for priority review, for the promising gene therapy etranacogene dezaparvovec. In clinical trials, etranacogene dezaparvovec has been shown to significantly reduce the rate of annual bleeds in people with haemophilia B after a single, one-time infusion compared to when these people were receiving recombinant factor IX therapy alone. If approved, it would be the first ever gene therapy treatment option for the haemophilia B community. This is a great development, and we are excited about the prospect of launching new and innovative products over the coming years.

Another example of a valuable investment relates to improving our donors’ experience when they visit our centres. Plasma donors are a fundamental part of our business, and without them patients would not have access to life-changing medicines. In order to optimise their experience in our centres, we are employing a new plasmapheresis platform utilising technology to support a safe, efficient and improved experience for plasma donors, as well as a better process for CSL Plasma employees. We will introduce this new technology across our 300 US centres through the latter part of 2022 to early 2023.

A Promising Future

In closing, I would like to thank our people, shareholders, partners, plasma donors and the many other stakeholders who allow us to bring people and science together to execute on our strategy. This combination helps us to achieve our purpose, which is to develop and deliver innovative medicines that help people with serious and life-threatening conditions live full lives and protect the health of communities around the world.

While we are not immune to the macroeconomic environment, I can assure you we will continue to operate with resilience, integrity and agility, and deliver sustainable growth .

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Paul Perreault CEO and Managing Director

Acquisition of Vifor Pharma

We recently announced the acquisition of Vifor Pharma (Vifor), a leading Swiss based company.

Vifor has a world-leading iron replacement platform for treatment of diseases such as iron deficiency anaemia and continues to generate extensive clinical data in related areas of high unmet medical need, such as iron deficiency in heart failure and patient blood management.

Through its extensive dialysis portfolio, Vifor has built a strong presence in renal diseases which continues to benefit from the introduction of novel therapies impacting disease progression.

A cornerstone of Vifor’s growth strategy has been its strategic partnerships, which have allowed Vifor to both broaden its portfolio and provide patients access to the treatments they need.

The Vifor business enhances CSL’s established focus on protecting the health of patients with a range of rare and serious medical conditions. Some of the strategic benefits of CSL’s acquisition of Vifor include ~~:~~

Strengthening CSL’s Value driven strategy: Vifor adds a durable and growing business with leadership positions across complementary and adjacent franchises, delivering greater benefit to patients.
Combined with CSL’s R&D capabilities and financial scale, it enables a significant renal disease franchise to be established in this large and growing market.
Extends the reach of CSL’s high value pipeline: Together, CSL and Vifor will have a complementary portfolio and enhanced access to unique patient populations for future clinical studies.

We look forward to aligning the rebrand of Vifor to CSL Vifor and integrating the business within CSL’s organisational structure and our 2030 Strategy.

CSL’s 2030 Strategy (with Vifor)

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Our Company

CSL at a Glance

40+ countries of operations around the world 30,000+ employees around the world US$10.6 billion in annual revenue 2000+ R&D employees US$4.6 billion in R&D investments in the last 5 years to advance product pipeline 330 plasma collection centres across China, Europe and North America.

Our Businesses

CSL Behring

CSL Behring is a global biotherapeutics leader driven by our promise to save lives. Focused on serving patients’ needs by using the latest technologies, we discover, develop and deliver innovative therapies for people living with conditions in the immunology, haematology, cardiovascular and metabolic, respiratory, and transplant therapeutic areas. We use three strategic scientific platforms of plasma fractionation, recombinant protein technology, and cell and gene therapy to support continued innovation and continually refine ways in which products can address unmet medical needs and help patients’ lead full lives.

CSL Behring operates one of the world’s largest plasma collection networks CSL Plasma.

CSL Seqirus

As one of the leading influenza vaccine providers in the world, CSL Seqirus is a major contributor to the prevention of influenza globally and a transcontinental partner in pandemic preparedness.

CSL Seqirus operates state-of-the-art production facilities in the United States (US), the United Kingdom (UK) and Australia and utilises both egg-based and cell-based manufacturing technologies as well as a proprietary adjuvant. It has leading research and development (R&D) capabilities, a broad and differentiated product portfolio and commercial operations in more than 20 countries.

Our R&D Pipeline

Our research and development pipeline

CSL’s world-class R&D organisation continues to evolve as a biotechnology leader by advancing high-quality science and technologies developed by our own highcalibre scientists and innovative collaborations. R&D utilises its expertise in our strategic platforms – plasma fractionation; recombinant protein technology; cell and gene therapy; and vaccines technology. This ensures CSL can develop and deliver innovative medicines and vaccines that address unmet medical needs, help prevent infectious disease and protect public health, and help patients lead full lives.

CSL’s strong R&D pipeline includes new treatments that utilise these platforms and align with its leading-edge scientific technology and commercial capabilities across our six therapeutic areas: immunology; haematology; cardiovascular and metabolic; respiratory; transplant; and influenza vaccines.

In 2021/22 CSL invested US$1.1 billion* in R&D across our businesses. Looking towards 2030, R&D continues to strive to deliver on the current portfolio of medicines and vaccines and build a full and innovative pipeline that will make a meaningful difference to the lives of patients with rare and serious diseases. This pipeline is expected to contribute new revenue streams well into the following decades.

*Limited assurance by Ernst & Young

Global Research and Development Pipeline 2021/2022

Immunology	Clinical	Registration	Post-Launch
HAEGARDA®(C1 Esterase Inhibitor subcutaneous) Hereditary Angioedema
HIZENTRA®(20% subcutaneous Ig) Multiple Indications
PRIVIGEN®(10% intravenous Ig) Multiple Indications
Garadacimab(Anti-FXIIa mAb) Hereditary Angioedema
HIZENTRA®(20% subcutaneous Ig) Dermatomyositis
HIZENTRA®(20% subcutaneous Ig) Systemic Sclerosis
CSL324(Anti-G-CSFR mAb) Hidradenitis Suppurativa
CSL730(Recombinant Trivalent Human IgG1 Fc Multimer)
Multiple Indications*
Haematology	Clinical	Registration	Post-Launch
AFSTYLA®(Recombinant FVIII) Haemophilia A
IDELVION®(Recombinant rFIX-FP) Haemophilia B
Etranacogene dezaparvovec(Recombinant adeno-associated viral vector
with codon-optimized Padua derivative of Human FIX cDNA) Haemophilia B
KCENTRA®(Prothrombin Complex Concentrate) Trauma CSL889(Hemopexin) Sickle Cell Disease
Respiratory	Clinical	Registration	Post-Launch
ZEMAIRA®/RESPREEZA®(Alpha 1 Antitrypsin) AAT Defciency Garadacimab(Anti-FXIIa mAb) Interstitial Lung Disease/Idiopathic Pulmonary Fibrosis
Trabikibart(Anti-Beta Common mAb) Asthma
CSL787(Nebulised Ig) Non-Cystic Fibrosis Bronchiectasis
Cardiovascular and Metabolic	Clinical	Registration	Post-Launch
CSL112[Apolipoprotein A-I (human)] Acute Coronary Syndrome
CSL346(Anti-VEGFB mAb) Diabetic Kidney Disease
Transplant	Clinical	Registration	Post-Launch
Clazakizumab(Anti-IL-6 mAb) Chronic Active Antibody-Mediated Rejection
CSL964(Alpha 1 Antitrypsin) Prevention of Graft-versus-Host Disease
CSL964(Alpha 1 Antitrypsin) Treatment of Graft-versus-Host Disease*
Infuenza Vaccines	Clinical	Registration	Post-Launch
AUDENZ™(Adjuvanted Cell-based Pandemic Vaccine) Infuenza A (H5N1) FLUAD®(Trivalent Adjuvanted Vaccine) Infuenza FLUAD®(Quadrivalent Adjuvanted Vaccine) Infuenza FLUCELVAX®(Quadrivalent Cell-based Vaccine) Infuenza FOCLIVIA®/FOCETRIA(Adjuvanted Egg-based Pandemic Vaccine) In luenza A (H5N1)
aQIVc(Adjuvanted Quadrivalent Cell-based Vaccine) Influenza
Outlicensed Programs	Clinical	Registration	Post-Launch
Eblasakimab(Anti-IL-13R mAb) Atopic Dermatitis
Mavrilimumab(Anti-GM-CSFR mAb) Giant Cell Arteritis, Rheumatoid Arthritis**

Partnered Project
** Mavrilimumab Phase II studies in GCA & RA complete. Kinikska evaluating development in rare cardiovascular diseases.

CSL’s pipeline also includes Life Cycle Management projects that address regulatory post-marketing commitments, pathogen safety, capacity expansions, yield improvements, and new packages and sizes. 13

Our Product Portfolio

CSL Behring

We meet patients’ needs using the latest recombinant and plasma-derived technologies. CSL Behring discovers, develops and delivers the broadest range of products in the industry for treating rare and serious diseases such as haemophilia, von Willebrand disease (vWD), primary immune deficiencies (PID), chronic inflammatory demyelinating polyneuropathy (CIDP), hereditary angioedema (HAE) and inherited respiratory disease. CSL Behring’s products are also used in cardiac surgery, for burns treatment and for urgent warfarin reversal.

Immunology

Our world leading immunoglobulin franchise is the cornerstone of the immunology therapeutic area.

Key CSL Behring products in market include PRIVIGEN[®] , HIZENTRA[®] , BERINERT[®] , HAEGARDA[®] and a range of hyperimmunes.

Haematology

We are focused on maximising the value of our existing portfolio, developing new therapies and identifying transformational treatments to help patients realise a life full of potential.

Key CSL Behring products in market include IDELVION®, AFSTYLA®, HUMATE P®/HAEMATE®, BERIPLEX®/KCENTRA®, VONCENTO®/BIOSTATE® and albumin.

Cardiovascular and metabolic

We are focused on improving and extending the lives of patients with cardiovascular disease (CVD) and diabetic kidney disease.

Respiratory

Respiratory diseases impose an enormous burden on patients and society and are a leading cause of death and disability worldwide.

Key CSL Behring products in market include ZEMAIRA[®] /RESPREEZA[®] .

Transplant

While advances in transplantation techniques and therapies have markedly improved short-term patient survival, transplant rejection remains one of the greatest limitations to long-term graft and patient survival for both solid organ and haematopoietic stem cell transplant recipients. We are focused on developing therapies to address transplant rejection.

CSL Seqirus

Our broad range of influenza vaccines meets the needs of different populations around the world. In Australia and New Zealand, CSL Seqirus is a leading provider of in-licensed vaccines and specialty pharmaceuticals. It is also the world’s only supplier of a unique range of products made in the national interest for the Australian Government, including antivenoms and Q fever vaccine.

Influenza Vaccines

Egg-based and cell-based products, seasonal, pre-pandemic and pandemic influenza vaccines.

Products of National Significance

Q fever vaccine and antivenoms for venomous creatures in Australia and other Pacific countries.

In-licensed Vaccines and Pharmaceuticals

For Australia and New Zealand.

Our Operating Review

CSL Behring

Total revenue was US$8,598 million, up 2%[1] when compared to the prior comparable period.

Immunoglobulin (Ig) product sales of US$4,024 million, were down 3%[1] as supply was constrained by the lower plasma collected in the previous year.

Despite the challenging environment, HIZENTRA® (Immune Globulin Subcutaneous (Human), 20% Liquid) sales were steady due to the preference for home administration and the continued uptake for HIZENTRA® for the treatment of Chronic Inflammatory Demyelinating Polyneuropathy (CIDP), a debilitating neurological disorder.

PRIVIGEN® (Immune Globulin Intravenous (Human), 10% Liquid) declined modestly, impacted by supply constraints and the patient preference for HIZENTRA®.

Underlying demand for Ig continues to be robust due to significant patient needs in core indications – namely Primary Immune Deficiency, Secondary Immune Deficiency and CIDP.

Specialty product sales of US$1,792 million, up 3%[1] led predominately by demand for KCENTRA® and to a lesser extent HAEGARDA®.

KCENTRA® (4 factor prothrombin complex concentrate) recorded sales growth of 18%[1] , as hospital demand for the product returned to pre-pandemic levels driven by penetration within large hospitals and expansion into smaller regional accounts.

HAEGARDA®, a therapy for patients with hereditary angioedema, grew by 5%[1] , driven by continued patient growth and a continued shift from on-demand to prophylaxis treatment. New launches in Europe and Australia have contributed to the rise in patient numbers.

Growth in the specialty portfolio was offset by lower wound healing product sales in Japan and a decline in ZEMAIRA® (alpha 1-proteinase inhibitor) following supply interruptions at our Kankakee facility in the US.

Haemophilia product sales of US$1,166 million increased 8%[1] .

IDELVION®, CSL Behring’s novel long-acting recombinant factor IX product, achieved strong growth of 20%[1] driven by its clinical profile that continues attract patient demand and gain market share. It remains the market leader for the treatment of haemophilia B patients.

The haemophilia A market has been competitive resulting in sales declines for AFSTYLA®, a novel recombinant factor VIII product, and plasma-derived products.

Albumin sales of US$1,072 million, were down 1%[1] . Sales in China were up strongly whereas sales in other major market such as the US and Europe declined modestly due to the supply constraints from the lower plasma collections in the previous year.

Plasma collections

Whilst plasma collections were adversely impacted by the COVID-19 pandemic in the previous financial year, this year saw strong growth with plasma volumes collected up 24%.

This was the result of targeted marketing efforts and enhanced digital initiatives to attract donors.

The cost of collections also increased including donor compensation and labour.

CSL Seqirus

Total revenue of $1,964 million, was up 13%[1] driven by growth in seasonal influenza vaccines and CSL Seqirus’ differentiated high value products, in particular FLUAD®, the adjuvanted product for the elderly market.

1 Constant Currency removes the impact of exchange rate movements to facilitate comparability of operational performance for the Group. This is done in three parts: a) by converting the current year net profit of entities in the group that have reporting currencies other than US Dollars, at the rates that were applicable to the prior comparable period (Translation Currency Effect); b) by restating material transactions booked by the group that are impacted by exchange rate movements at the rate that would have applied to the transaction if it had occurred in the prior comparable period (Transaction Currency Effect); and c) by adjusting for current year foreign currency gains and losses (Foreign Currency Effect). The sum of translation currency effect, transaction currency effect and foreign currency effect is the amount by which reported net profit is adjusted to calculate the result at constant currency.

Financial Highlights & Reported Results

CSL announced a net profit after tax of US$2,255 million for the 12 months ending 30 June 2022, down 5% when compared to the prior comparable period. Net profit after tax at constant currency declined 6%.

Sales revenue was US$10,136 million, up 3%[1] when compared to the prior comparable period in comparison to the previous financial year.

Expense performance

Research and development (R&D) expenses were US$1,156 million, up 17%[1] when compared to the prior comparable period. The increase in expenses reflect further progression of our R&D projects since the easing of COVID-19 restrictions.
Selling and marketing expenses (S&M) were steady[1] at US$961 million in comparison to the previous year. Whilst we had additional expenses on Etranacogene dezaparvovec pre-launch activities, we managed to hold S&M expenses in-line with prior year.
General and administrative (G&A) expenses were US$688 million, an increase of 4%[1] when compared to the prior comparable period. The increase in G&A expenses were largely related to costs associated with acquiring Vifor. Excluding Vifor acquisition costs, G&A expenses were lower than prior year.
Depreciation, amortisation (D&A) expense and impairment was US$668 million, up 14%[1] in comparison to the prior comparable period. D&A has increased due to continued commissioning of major capital and IT projects.
Net finance costs were US$148 million, down 4%[1] . The decrease in net finance costs were predominantly related to an increase in finance income, largely driven by higher interest rates and operating cash balances inclusive of the equity proceeds related to the acquisition of Vifor.

Financial position

Cashflow from operations was US$2,629 million, down 27%. This reflects lower profit before tax and significant increase in inventories driven by higher plasma costs per litre and improved plasma volumes collected.
Cashflow used for investing was US$1,636 million, down 2% when compared to the prior comparable period, predominantly driven by lower capital spend.
CSL’s balance sheet remains in a strong position with net assets of US$14,578 million.
Current assets increased by 123% to US$16,461 million. The main driver was from strong cash inflows from operations as well as equity and debt proceeds related to the acquisition of Vifor.
Non-current assets increased by 10% to US$11,885 million in comparison to the previous year. The increase is mainly due to continued capital project spend, new right of use assets relating to leases of new facilities together with the on market acquisition of a minority of Vifor shares.
Current liabilities increased by 129% to US$7,108 million. The significant increase is mostly related to debt finance raised for the Vifor acquisition, which was treated as a current liability at 30 June due to a redemption feature should the deal not have

completed. Following the subsequent completion of the Vifor acquisition, the related debt will be classified as non-current from the date of completion with the redemption feature now being met.

Non-current liabilities were steady at $6,660 million compared to last financial year. Increase in deferred tax liabilities were mostly offset by lower non-current interest-bearing liabilities and borrowings coupled with decrease in retirement benefit liabilities.
Constant Currency removes the impact of exchange rate movements to facilitate comparability of operational performance for the Group. This is done in three parts: a) by converting the current year net profit of entities in the group that have reporting currencies other than US Dollars, at the rates that were applicable to the prior comparable period (Translation Currency Effect); b) by restating material transactions booked by the group that are impacted by exchange rate movements at the rate that would have applied to the transaction if it had occurred in the prior comparable period (Transaction Currency Effect); and c) by adjusting for current year foreign currency gains and losses (Foreign Currency Effect). The sum of translation currency effect, transaction currency effect and foreign currency effect is the amount by which reported net profit is adjusted to calculate the result at constant currency.

Our Value Creation Chain

What we depend on

Unmet need

Opportunities to improve and protect the quality of life of patients and communities in therapy areas we treat.

Natural resources

Includes: plasma donations for rare and serious diseases; influenza virus strains for product manufacture; and environmental inputs such as water and energy.

Physical assets

Plasma centres to collect raw material, manufacturing facilities for our products, warehouses, offices for our people and laboratories for our scientists.

Our people

30,000+ people with diverse skills that are driven by our purpose and values.

Financial resources

Cash, equity and debt for future growth.

Collaborators and business partners

Accessing and sharing intellectual know how to develop and innovate our products.

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Our Strategy
Strategic Sustainability
Pillars & Focus Areas
Environment
Patients and
Public Health Social
Workforce
Our expertise and operations
Sourcing Pharmacovigilance
including plasma collection
Early stage research Product development Manufacturing Sales, marketing, policy
& collaboration & clinical trials & distribution advocacy & patient support
CSLPeople & Culture
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CSL’s Purpose, Values and Code of Responsible Business Practice

Value we create

A healthier more productive society

Protecting global health and the wellbeing of individuals, families, businesses and communities from life-threatening and/or complications resulting from influenza. Saving and/or improving the quality of life of hundreds and thousands of people with rare and serious diseases.

and responsible growth for our investors, which fuels innovation and development.

Social and economic opportunity

Enabling hundreds of thousands of people to benefit from opportunity created by growing along with us, including employees, suppliers, plasma donors and research partners.

Our promise to patients

Our Strategy and Performance

CSL is driving sustainable growth to bring lifesaving therapies to patients and protect public health across the globe. We are focused on delivering across our therapeutic areas through innovation and our tireless approach to efficiency and reliable supply.

CSL’s 2030 Strategy has been developed to maximise our capabilities and advantages in a competitive and constantly changing world. Historically and to this day, we are continously innovating to increase efficiencies in our supply chain with plasma collections to finished product for our plasma-derived protein therapeutics – a business that has grown sustainably over the years, is difficult to replicate and does not face patent cliffs. Our differentiated cell-based and adjuvanted influenza products offer communities improved protection against influenza, and our extensive experience in rare disease allows us to focus on patients in our core therapeutic areas, delivering next-generation innovative products across multiple platforms.

Our strategic pillars are represented in the Our 2030 Strategy (with Vifor) graphic on page 10. We focus on supporting patients and global public health in our core therapeutic areas. Our sustained investment in innovation, with an R&D budget of around US$1 billion, allows us the resources to develop the next generation of products to serve patients and public health. We are driven to be a leader in our fields of expertise and deliver a reliable supply of our lifesaving therapies. For sustainable growth of the enterprise, we are committed to serving our populations with the best available therapy across our strategic scientific platforms – plasma fractionation, recombinant protein technology, cell and gene therapy and vaccines. We see the promise of digital transformation to drive efficiency in our business and innovation to patients. At the centre of it all, we are investing in the more than 30,000 people who make up CSL, while remaining environmentally responsible as part of our sustainability strategy.

Driving Sustainable Growth of Our Core Platforms

Plasma-derived therapies rely on plasma collections from donors to manufacture lifesaving products at our sites around the world. While the pandemic disrupted collections, we continued to invest in centre openings, operational improvements and digital engagement to donors through our CSL Plasma app to drive our sustainable growth path as conditions become more favorable. Today, collection volumes are exceeding our pre-pandemic levels.

As plasma collection volumes increase, we continue our investment in efforts to increase the yield of proteins recovered from each litre of plasma. Our commitment to innovation and our end-to-end network approach allow us to look at new ways to recover as much lifesaving protein as possible, from systematic process improvements through to highly innovative, transformative technologies.

CSL’s core plasma products have a long history of being safe and effective. We continue to explore the potential benefits of our existing products in new indications to expand the number of patients that can benefit. We are also looking at new products derived from plasma, such as CSL112, which has the potential to be another important, lifesaving product and drive sustainable growth for the enterprise.

CSL Seqirus distributed a record number of vaccine doses in the last year, reflecting the public health benefits of our innovative influenza vaccines product portfolio.

We also continue to invest in the capabilities needed to drive sustainable growth, including commercial, R&D, medical and government affairs, which are critical to driving recognition of the benefits of our differentiated vaccine technologies.

We are taking a pioneering role in innovation, leveraging our cell, adjuvant and selfamplifying mRNA (sa-mRNA) technologies. Several of our products have been recognised by achieving preferred recommendations from National Immunisation Technical Advisory Groups.

To support future growth in vaccines, we are also investing in new manufacturing capabilites, including recently completed fill and finish expansions in Liverpool, UK, and Holly Springs, North Carolina, US, and ongoing work at our new cell-based manufacturing facility in Tullamarine, Australia, which is expected to commence commercial vaccine production in 2026.

Disruptive R&D Innovation to Better Meet the Needs of Patients and Public Health

We are committed to serving patients and public health within our therapeutic areas by developing novel therapeutics and vaccines using our plasma fractionation, recombinant protein technology, cell and gene therapy and vaccines platforms.

Today, we have a single, integrated R&D portfolio encompassing all programs across multiple therapeutic areas and scientific platforms, providing strong foundations for sustainable growth.

Bringing together and integrating resources in our R&D functions allows us to share capabilities when possible and to enrich collaboration in functions where capabilities remain separate. The integrated portfolios, scientific synergies and complementary mindset will serve to build an even more robust pipeline and future for CSL. There are already numerous success stories of teams joining forces to solve challenging problems.

Our focus on patients and innovation has delivered novel products like our classleading recombinant factor IX albumin fusion protein, IDELVION®, for the treatment of haemophilia B. IDELVION® is the most trusted brand in the haemophilia B space and we continue to deliver for patients with the promising etranacogene dezaparvovec, a gene therapy with transformative potential to the lives of haemophilia B patients.

Beyond haemophilia, we continue to develop promising products for patients with other diseases such as hereditary angioedema (HAE). While HAEGARDA® results in near-elimination of HAE attacks for patients, garadacimab – our anti-factor XIIa monoclonal antibody in late stage development has the potential to provide patients with similar control with less frequent dosing and easier administration. Other products in development include CSL112, our human apolipoprotein A-I product to reduce the risk of recurrent cardiovascular events during the 90-day high-risk period following a heart attack, and planning for a global Phase III study to evaluate the early administration of KCENTRA® (4-factor prothrombin complex concentrate) on survival in trauma patients suffering life-threatening bleeding.

We are also investing in new vaccine technologies to protect the public health, including next generation technologies such as sa-mRNA and aQIVc.

These are just some examples of how CSL’s R&D team seeks to disrupt the status quo and explore better options for patients, including the potential benefits of our existing products in new indications.

Our Digital Transformation

Technology is pushing us forward. Advances in analytics and automation are accelerating our path to sustainable growth. This acceleration is also extending the value of digital transformation from productivity of our processes and people, to new ways of keeping our promise to patients.

In the core of our business, analytics and automation are enhancing the plasma donor experience, improving yield in the supply chain, and facilitating customercentricity. Supporting this is analytics and automation, these support the rate of experimentation in biomedical discovery, differentiate our therapies through observational and real-world evidence, and guide our patients through the complexity of care.

Going forward, we expect more change. Real world observations are likely to lead to clinical decision support algorithms for insights at the point of care. Yield improvements are likely to lead to digital twinning of our supply chain. Patient engagement is likely to lead to decentralised clinical trials.

Underlying our digital transformation is an effort to modernise our technology backbone to further enhance reliability and security. The renewed foundation also operates as a platform for a better workplace experience and an increasing rate of digital innovation.

Advancing Promising Futures for Our People

CSL’s sustained success and the lives of the patients we serve rely on the more than 30,000 people who make up CSL around the world. Investing in our people is an enterprise-wide priority, and we have a variety of initiatives in place to ensure we attract, develop, reward and retain the best talent across the globe.

At CSL, we believe our people can enjoy promising futures where they fulfill their individual career aspirations and potential and are inspired by a purpose-driven company with a values-based culture.

At every level of the organisation, we focus on:

enabling career development across the enterprise with special attention to front-line leaders;
establishing succession plans to support a robust leadership pipeline now and in the future;
enhancing CSL’s culture by listening to our employees and key stakeholders and making improvements to the employee and patient experience; and
embedding diversity, equity and inclusion (DEI) in all aspects of our business – from planning to decision making – and ensuring we have an engaging culture and workplace.

Our Sustainability Strategy

To foster a more sustainable future, we announced our sustainability strategy in August 2021, focussing on three strategic pillars – Environment, Social and Sustainable Workforce. We have identified these three strategic pillars as material to our business where we plan to increase our engagement and accelerate action over the medium- to long-term. Performance across our strategic pillars will support execution of our 2030 Strategy and our promise to improve the lives of patients and protect public health. Our pillar focus areas are further guided by our material topics, which inform continuous improvement across our operations and transparency in areas that matter most to our key stakeholders.

Sustainability Framework

Our Vision

CSL is committed to a healthier world. Our vision is a sustainable future for our employees, communities, patients and donors, inspired by innovative science and a values-driven culture

Sustainability Framework	Sustainability Framework	Sustainability Framework	Sustainability Framework
Our Vision CSL is committed to a healthier world. Our vision is a sustainable future for our employees, communities, patients and donors,inspired byinnovative science and a values-driven culture
	Environment	Social	Sustainable Workforce
Focus areas	• Integrate sustainability considerations into business decisions • Minimise end to end production of waste through removal, reduction and recycling • Reduction of carbon emissions/waste in our supply chain • Reduce carbon emissions.	• Being trusted by donors through a focus on their experience and wellbeing, and their communities • Strengthen societal health through access to our existing products and therapies and investment in innovation • Enhance our industry position as a patient-focused and public health leader	• Raise awareness, visibility and engagement of sustainability across the end-to-end working experience for our employees • Communicate to and engage with employees in programs that maximise diversity, equity and inclusion • Ensure all CSL employees have access and opportunity to participate in community giving programs and volunteerism for local needs
Material topics*	• Promoting environmental protection • Climate change and climate resilience • Energy and emissions • Waste and packaging	• Product safety and quality • Supply continuity and resilience, including human rights and responsible supply chain^ • Innovation and R&D	• Talent recruitment, development and retention • Health, safety and wellbeing • Diversity, equity and inclusion For more see section 7 in this report.

• Trust and For more see section 8 in transparency this report. • Health security • Accessible and affordable healthcare For more see section 9 in this report. Key SDGs CSL continues to be guided by the General Assembly of the United Nations (UN) 2030 Agenda for Sustainable Development, which includes 17 Sustainable Development Goals (SDGs). The goals seek to address global challenges, including those related to health and wellbeing, inequality, innovation and climate change. For CSL, these goals continue to guide our actions and inform our 2030 and sustainability strategies, with four being identified as key goals where our sustainability performance can positively influence their achievement. More on SDGs on CSL.com (Our Company > Corporate Responsibility > Approach).

*Limited assurance by Ernst & Young

^ Human rights and responsible supply chain was identified as a material topic under Governance, but has been combined with supply continuity and resilience. Ethics and integrity was the other material topic prioritised under Governance and detailed in section 10 of this report. More on material topics can be found on CSL.com (Corporate Responsibility > Approach).

For the reporting year, our focus has been on advancing progress across our environmental pillar. We have taken necessary steps to understand the impacts of climate change on key assets and in responding to the challenges of a warming globe by delving deep into our operations today and well into the future. We have developed emission reduction targets across Value Chain. We are pleased to announce new carbon emissions reductions targets that will serve as a tangible, transparent roadmap to decarbonise our operations by reducing our direct and indirect emissions footprint. As such, in alignment with science- based targets, we commit to a 40% reduction in absolute Scope 1 and Scope 2 emissions by 2030, using the average of CSL’s FY19-21 emissions as the basis. Further, we intend to ensure that suppliers who contribute 67% of our Scope 3 emissions have set Science Based Targets initiative aligned Scope 1 and 2 reductions by 2030.

We continue to progress other focus areas across our other pillars, including access to our therapies, sustainable workforce, employee engagement and diversity, equity and inclusion, as detailed within this report.

In support of our efforts, an executive committee has been established with several global executives as members. This committee has hands-on responsibility for formulating and achieving CSL’s sustainability goals. It will create a culture of accountability across CSL. CSL’s Board of Directors will retain oversight of progress through the Board and its Committees.

Climate change risk assessment

CSL has a practice of periodically conducting climate change risk assessments. This year we concluded an enterprise-wide risk assessment of our manufacturing facilities, CSL Plasma operations and key warehouse and third-party logistics infrastructure.

Our current view of the impact of climate change has been factored into our financial reporting for the year ended 30 June 2022. The impact assessment was primarily focused on the valuation and useful lives of intangible assets and the identification and valuation of provisions and contingent liabilities, as these are judged to be the key areas that could be impacted by the current reasonably foreseeable climate risks. No material accounting impacts or changes to judgements or other required disclosures were noted. While the Group’s assessment did not have a material impact for the year ended 30 June 2022, this may change in future periods as the Group regularly updates its assessment of the impact of the lower carbon economy.

Our Material Risks

CSL operates in a fast paced and constantly evolving environment of science, technology and healthcare. We are exposed to risks inherent in the global biotechnology industry, and in particular the plasma therapies and vaccine industries, which include research and development, intellectual property and clinical trials.

We are also exposed more broadly to external risks such as the COVID-19 pandemic and the Russia-Ukraine conflict and we regularly review our group risk profile to proactively identify material business risks and opportunities and assess external risks that could affect our global operations. Managing risks includes both the mitigation of disruptive risks and the preparation for seizing opportunities. Our global Enterprise Risk Management Framework is designed to ensure robust risk oversight that is fit-for-purpose for both the operation of our business and to support our strategy and deliver on our commitments to patients and public health.

As part of our enterprise risk management process, the Board and management team have identified the key risks that are material to CSL. These material group risks are described below along with an explanation of our approach to managing them in the context of delivering on our 2030 Strategy. Key financial risks are set out in Note 11 to the Financial Statements.

There are other risks that are inherent in the vaccine, pharmaceutical and plasma therapies industries, besides those detailed below or in the Financial Statements, that could also adversely affect CSL’s business and operations.

Patient safety and product quality

Patient safety is paramount for CSL’s ongoing sustainability as a global biotechnology leader and our long-term strategy of efficiency and reliable supply. When we talk about patient safety, we mean both in the use and administration of registered products as well as in the conduct of our clinical trials. While it is inherent in our industry that patients and trial participants may experience adverse reactions to therapies, CSL’s manufacturing, product quality assurance and pharmacovigilance practices serve to ensure the highest standards of safety and the preservation of our reputational integrity.

Our processes and procedures meet good pharmacovigilance practice (GPV) and good clinical practice (GCP) standards we seek to ensure that product information is up-to-date and contains all relevant information to assist healthcare practitioners to appropriately prescribe CSL products. For clinical trials, participants are informed and acknowledge awareness of the benefits and risks of participation in the trial through use of Informed Consent Forms approved by regulators.

In terms of meeting product quality requirements through our manufacturing and supply, we adopt and comply with a broad suite of internationally recognised standards through the CSL Quality Management System, including good manufacturing practice (GMP), good distribution practice (GDP) and audits of thirdparty vendors and suppliers. We are frequently inspected by independent regulatory authorities auditing compliance with these standards.

Product innovation and competition

We recognise that an impediment to delivering on our innovation and sustainable growth strategies is the changing competitive landscape for new technologies and disruptive therapies, such as cell and gene therapies. This material risk may alter the economics and characteristics of, and the demand for, CSL’s plasma and adjacent therapies, and may also affect our platforms and capabilities in plasma fractionation, recombinant technology, and cell and gene therapy.

We strategically review our existing and future product pipeline against market demand and continually evaluate our competitive landscape. A key part of our strategy includes diversity in our product pipeline, and focus on six therapeutic areas (immunology, haematology, respiratory, cardiovascular and metabolic, transplant, and influenza vaccines). We incorporate product lifecycle development and management, as well as development of new therapies, in strategies for each therapeutic area. In addition to proprietary research, CSL’s competitive approach includes licensing, acquiring or partnering with third parties to remain competitive and advance growth within our chosen therapeutic areas.

With respect to continued growth and innovation in the competitive global influenza vaccine market, we recognise the need to continue leading in the development and manufacture of influenza vaccines including cell culture technology and investigating the use of self-amplifying mRNA technology. Failure to capitalise on innovative technology will diminish growth in this product sector, whereas success will deliver competitive advantages.

Supply, capacity and operations

Having a sustainable and reliable supply chain is critical to the success of our 2030 Strategy, particularly to achieving consistent, economical and efficient supply. When considering this material risk, we constantly monitor the demand for and supply of collecting and acquiring human plasma. We also monitor the scalability of specialised companies who supply raw materials, software and bespoke manufacturing equipment to match our business demand and growth objectives.

Both plasma collection and raw material supply across our businesses have been impacted by COVID-19, requiring us to implement both immediate and continued risk mitigations to manage this risk. Similarly, with the ongoing Russia Ukraine conflict, the EU energy crisis continues to escalate. Higher gas prices could affect all our sites and suppliers, while gas supply constraints will mostly affect our EU operations. Several mitigation actions have been identified and contingency plans established to help prevent disruption to our operations however the situation will continue to be monitored as the conflict continues.

In our US and European plasma collection centres, we utilise modern techniques and technologies to facilitate the safest, most efficient donation process. We consistently update our plasma collection centres to seek to provide a comfortable and safe donor experience. External sources of plasma may be utilised as needed and available to supplement collections to meet demand.

We endeavour to invest in manufacturing capacity ahead of projected demand to ensure that we can supply the needs of patients. Our operations also accommodate investments in technology and process improvements to enhance efficiency and reduce costs. This includes improving immunoglobulin protein yield from each litre of plasma, increasing throughput of our existing facilities and pursuing the development of new plasma-derived proteins for therapeutic use to further improve the economic value of each litre of plasma. CSL also seeks to develop non-plasma alternative therapies to supplement patient needs.

Our end-to-end operations network strategy continually evaluates short-, mid-, and long-term needs to inform decisions on capital and operational expenditures, including the use of expert third party providers to ensure a resilient, reliable and sustainable supply chain. We examine and prioritise our operational effectiveness efforts, capital plans, inventory targets, supply chain visibility, distribution and regulatory strategies to enhance the positions of our products from a business continuity and supply chain resilience standpoint.

Market access

Policy making around market access is a multi-stakeholder engagement process, which includes governments, payers/insurers, patient advocacy groups, medical

societies and non-governmental organisations. We recognise that if we are not successful in maintaining an economic and reliable supply of our therapies for our stakeholders, it may adversely affect our ability to execute our strategy and to deliver sustainable growth. In particular, we recognise that macroeconomic pressures on pricing and payers (including barrier taxes) may impair access, growth and new market entries. We work closely with stakeholders in all markets and continually seek to ensure pricing of our therapies remains competitive in all markets. By striving to innovate in our product portfolio, we can also expand our access to competitive markets.

People and culture

Our people and our ability to maintain our desired culture are integral to meeting and exceeding the standards expected by our stakeholders and the community. We have a number of programs and policies in place to ensure that or values underlie how we do things including our Speak Up Policy and our Code of Responsible Business Practice (CRBP).

We also recognise the need to have the right people in the right roles in order to execute our 2030 Strategy. To attract, develop and retain skilled and talented people in a globally competitive environment, we review market practice, and frequently benchmark ourselves against the markets in which we operate to ensure we offer total rewards that are both compelling and competitive with our peers and competitors.

In addition to this, we recognise the evolution of our workforce environment, including the challenges and opportunities created by COVID-19. We have implemented a flexible working environment for those workers at CSL where it makes sense to do so. We constantly challenge ourselves to create a work dynamic where our people can focus on meaningful, valuable work.

As the cornerstone to our employee value proposition, we have implemented an initiative called Promising Futures, which emphasises digitalisation and automation, employee development, collaboration and connectivity and customised rewards for attracting next-generation talent.

Privacy and cybersecurity

Maintaining privacy and security of all data including that of our patients, plasma donors, employees and company data is critical. We continue to see a growing trend in cyberthreats against individuals and companies. The nature of these cyberattacks is constantly evolving and can include sophisticated phishing scams and attacks on critical infrastructure. Additionally, the privacy and security of the data we hold may be compromised by breaches of our information technology (IT) security and unauthorised or inadvertent release of information through human error, malware or espionage.

CSL continuously monitors and assesses its cybersecurity threats. We have implemented robust and externally tested security controls for our IT systems, infrastructure and data, based on our understanding of known threats and best practice industry knowledge. We also provide educational updates and training so that our people can recognise and properly respond to a cyberattack or report a privacy breach.

Further details about our enterprise risk management framework and how we manage our business risks is provided in our 2022 Corporate Governance Statement available on CSL.com (Our Company > Corporate Governance).

Our Future Prospects

The fundamentals of CSL’s business, including our talented people, strong platforms and leading products, position CSL to deliver growth over the long term.

Our commitment to patients and to deliver innovative products is unwavering. As CSL looks ahead, the 2030 Strategy is designed to be resilient and allow us to better serve our patients well into the future, providing a strong platform for growth for shareholders.

We focus on life saving therapies for people with rare diseases and on providing differentiated influenza vaccines that protect the health of populations. The underlying demand for our existing products in the core plasma, recombinant and vaccine platforms is driven by expanding markets and indications across geographies in each of our six therapeutic areas.

The core plasma and influenza vaccines platforms have advantages that position us for growth over the long term, and provide competitive advantage over our peers. They deliver products that are complex to make, and require special skills that are not easily replicable. In addition, not all of our products are subject to patent protection and the subsequent revenue cliffs that can occur upon expiry. This allows us to sustainably grow our core business’ across therapeutic areas, platforms and geographies.

The future prospects of our core business depend on having the right talent to execute our 2030 Strategy. As a purpose-driven organisation, we are recognised as a great place to work because of our culture and values. It takes a unique mix of people to get the most out of our plasma business, grow our vaccines footprint and innovate the next generation of products.

Given these strong advantages in platforms, products and people, the outlook for CSL is strengething as we move beyond the COVID-19 pandemic.

CSL’s platforms, products and people moving us beyond COVID-19

The COVID-19 pandemic has affected the industry’s ability to collect plasma, which in turn has caused a tightness in supply of the end products and constrained the industry’s ability to fulfill patient demand.
Our plasma collection volumes have recovered to their pre-pandemic levels. Notwithstanding a long manufacturing cycle (typically 9-12 months) we expect the tightness in supply to alleviate throughout the rest of the calendar year.
Continued investments over the last few years, including expanding the collections network to over 300 centres and the rollout of the new Terumo plasma collection device, improve the donor experience and gives us a great position to capture growth opportunities, particularly in our leading HIZENTRA®/PRIVIGEN® immunoglobulin franchise.
Over the past two years, we have experienced strong demand for influenza vaccines as governments look to protect their health systems and populations, and to avoid a twindemic of COVID-19 and influenza. The demand profile is likely to continue to be robust as stakeholders recognise the benefits of population-level protection.
The acquistion of Vifor, upon closing, broadens our base with additional growth opportunities in iron replacement, dialysis and nephrology.

Beyond our existing products, the R&D organisation is developing a portfolio of novel products to drive the next generation of growth. We are poised to launch our first gene therapy product, etranacogene dezaparvovec for haemophilia B, in the coming year and continue to develop novel monoclonal antibodies as well as next-generation technologies including aQIVc and sa-mRNA. In addition to novel products, our R&D efforts include expanding markets and indications for our existing products. These efforts provide new areas of growth across our therapeutic areas. Some examples are listed:

In the near term our gene therapy candidate, etranacogene dezaparvovec, is in the final stages of submission and if approved, will transform how haemophilia B patients are treated.
In the mid-term we will endeavour to broaden our offering to patients with hereditary angioedema to include our recombinant monoclonal antibody, garadacimab.

Over the longer term, we have a number of innovative R&D programs in our pipeline such as CSL112, currently in development and aimed at reducing the risk of recurrent cardiovascular events.

Our focus on extending and improving the lives of patients with rare and serious diseases has not wavered through the COVID-19 pandemic. In the future we may face a new set of challenges and opportunities that we must address to position us for growth over the longterm.

We expect some cost pressure due to inflation and other supply chain factors. At the time of this writing, inflation is the highest in decades due to supply chain uncertainty, geopolitical challenges including the war in Ukraine and other factors. While policy makers have signalled the priority for fighting inflation, inflation could remain elevated for a sustained period. Given the markets we serve, we aim to grow sustainably through cost containment and productivity measures, such as yield improvements.

We also expect significant competition from companies manufacturing products similar to ours and the uncertain impact of substitute products that are on the market or in development. The entry of anti-FcRn products may also represent a competitive threat, however demand for plasma products, particularly immunoglobulin, is expected to continue in the long-run driven by diagnosis of diseases such as primary immunodeficiency disease (PID). In the near term (3-5 years) immunomodulation indications where FcRns may receive approval are not expected to be substitutes for our immunoglobulin products. In addition, other competitors are exploring the use of novel technologies, such as mRNA, in the influenza vaccine space.

More information in relation to our outlook is provided in our full year investor briefing presentation, and further information on the factors that could affect our outlook is provided in Our Material Risks on page 26.

Demand for CSL Behring’s core plasma products is expected to remain robust. The significant growth in plasma collections is expected to underpin strong future sales of core plasma therapies.

Product differentiation is expected to continue to drive strong demand for CSL Seqirus’ influenza vaccines.

The company anticipates a strong financial performance and a return to growth in FY2023.

Business strategies, prospects and likely developments

This Operating and Financial Review (OFR) sets out information on CSL’s business strategies and prospects for future financial years, and refers to likely developments in CSL’s operations and the expected results of those operations. Information in the OFR is provided to enable shareholders to make an informed assessment of the business strategies and prospects for future financial years of the CSL Group.

Certain information is excluded from the OFR (which forms part of the Directors’ Report) on the basis that such information relates to impending developments or matters in the course of negotiation and disclosure would be unreasonably prejudicial to the interests of CSL. Reasons that could be considered unreasonably prejudicial to the interests of CSL include providing information that is misleading due to the fact it is premature or preliminary in nature, relates to commercially sensitive contracts, would undermine the confidentiality between CSL and contract counterparties, or would otherwise unreasonably damage CSL. The categories of information omitted include forward looking estimates and projections prepared for internal management purposes, information which is developing and susceptible to change and information relating to commercial contracts and pricing.

Our Governance

CSL Limited’s Board and management team maintain high standards of corporate governance as part of CSL’s commitment to maximise shareholder value. This is achieved through promoting effective strategic planning, risk management, transparency and corporate responsibility.

Governance structure

Our approach to corporate governance and the role it plays goes well beyond meeting our compliance obligations. We believe that our governance framework fosters our high performing and respectful culture while underpinning CSL’s Values of Patient Focus, Innovation, Integrity, Collaboration and Superior Performance. The Board has a formal charter documenting its membership, operating procedures and the allocation of responsibilities between the Board and management. CSL’s Board charter is central to the governance framework at CSL as it embodies our corporate purpose, strategy and values and defines when we are successful.

CSL’s Board of Directors is responsible for overseeing the management of CSL and providing strategic direction. It monitors operational and financial performance, strategic human resource matters and approves CSL’s budgets and business plans. It is also responsible for overseeing CSL’s risk management, financial reporting and compliance framework.

The Board has delegated the day-to-day management of CSL, and the implementation of approved business plans and strategies, to the CEO and Managing Director, who in turn may further delegate to senior management.

The following diagram shows the governance framework of CSL. Robust processes are in place to ensure the delegation flows through the Board and its committees to the CEO and Managing Director, the Global Leadership Group (GLG) and into the organisation. The CEO and Managing Director and GLG have responsibility for the day-to-day management of the Group. Our governance framework also aligns the flow of information and accountability from our people, through the management levels, to the Board and ultimately our shareholders and key stakeholders.

Board composition

Throughout the year there were nine directors on the Board. At the date of this report, there are nine directors on the Board, comprising seven independent non-executive directors, one non-independent non-executive director and one executive director.

Since 1 July 2021 to the date of this report, the following changes to directorships occurred:

Professor Duncan Maskell and Ms Alison Watkins were appointed to the Board on 18 August 2021 and were elected as directors at the 2021 Annual General Meeting (AGM);
Dr Brian McNamee was re-elected as a director and Chair of the Board at the 2021 AGM; and
Professor Andrew Cuthbertson retired from the Board as an Executive Director on 1 October 2021 and was re-elected as a Non-Executive Director at the 2021 AGM.

The Board is focused on maintaining an appropriate mix of skills and diversity in its membership. This includes a range of skills, experience and background in the pharmaceutical industry, international business, finance and accounting, and management, as well as gender diversity. A detailed matrix of Board skills is available in

CSL’s 2021/22 Corporate Governance Statement available at https://www.csl.com/our company/corporate-governance.

Board of Directors

Dr McNamee has deep executive experience in the biopharmaceutical industry, with a focus on strategy and creating long-term shareholder value. Dr McNamee was the Chief Executive Officer and Managing Director of CSL from 1990 until 2013. Brian McNamee AO Since leaving his executive role at CSL, Dr MBBS, FTSE McNamee has served as a senior advisor to private Chair and Independent equity group Kohlberg Kravis Roberts. He has also Non-Executive Director pursued a number of private equity and interests Director of CSL Limited since in small cap healthcare companies, and in 2014 served on the panel of the Australian February 2018 and Chair from October 2018. Government’s Financial System Inquiry. In 2009, he was made an Officer of the Order of Australia for service to business and commerce. Other directorships and offices (current and recent): • Chair of Geoff Ogilvy Foundation (since May 2021); and • Former Chair of GenesisCare Limited (from July 2019 to June 2022). Board Committee memberships: • Member of the Innovation and Development Committee; • Member of the Corporate Governance and Nomination Committee; and • Member of the Securities and Market Disclosure Committee. Mr Perreault has more than 37 years of experience across both the global biotech and pharmaceutical industries. He was appointed Chief Executive Officer and Managing Director of CSL Limited in July 2013, and was appointed to the CSL Board of Directors Paul Perreault the same year. Since then, CSL has grown to BA (Psychology) become the third largest biotech company in the Non-independent Executive world, with more than 30,000 employees bringing Director lifesaving medicines to people in more than 100 Director of CSL Limited since countries. February 2013, and appointed Mr Perreault, who previously served as CSL Chief Executive Officer and Behring’s president, joined CSL in 2004 with the Managing Director in July acquisition of Aventis Behring. Prior to CSL, he 2013. spent more than 15 years in key senior roles at Wyeth-Ayerst Laboratories, now part of Pfizer. Mr Perreault holds a bachelor’s degree in psychology from the University of Central Florida and completed advanced business management training at the Kellogg and Wharton schools of business. Other directorships and offices (current and recent):

	• Director of the US Pharmaceutical Research
	and Manufacturers of America Association
	(PhRMA) (since December 2020).
	Board Committee memberships:
	• Member of the Innovation and
	Development Committee; and
	• Member of the Securities and Market
	Disclosure Committee.
	Mr Brook has an extensive breadth of executive
	experience in diverse industries, including mining,
	finance, manufacturing and chemicals. In
	particular, Mr Brook has valuable insight and
	experience in relation to risk, capital discipline,
	change management, corporate culture and
Bruce Brook	creating shareholder value.
BCom, BAcc, FCA, MAICD	Mr Brook was chief financial officer of WMC
Independent Non-Executive	Resources Limited from 2002 to 2005. He also
Director	held key executive roles including deputy chief
Director of CSL Limited since	finance officer of ANZ Banking Group Limited,
August 2011.	group chief accountant of Pacific Dunlop Limited
	and general manager, Group Accounting
	positions at CRA Limited and Pasminco Limited.
	Other directorships and offices (current and
	recent):
	• Director of Djerriwarrh Investments Limited
	(since August 2021);
	• Director of Guide Dogs Victoria (since
	November 2018);
	• Director of Incitec Pivot Limited (since
	December 2018); and
	• Director of Newmont Corporation (since
	October 2011).
	Board Committee memberships:
	• Chair of the Audit and Risk Management
	Committee; and
	• Member of the Corporate Governance and
	Nomination Committee.
	Dr Clark has significant executive and Non-
	Executive experience across a broad range of
	sectors, including scientific research, health,
	investment banking and financial services,
	education and mining. Through her roles, Dr Clark
Megan Clark AC	brings a broad strategic perspective and global experience, with a focus on risk and proven health,
BSc (Hons) PhD	safety and environment and technology
Independent Non-	performance.
Executive Director	In 2014 Dr Clark was made a Companion of the
Director of CSL Limited	Order of Australia for eminent service to scientific
since February 2016.	research and development.
	Dr Clark was chief executive of the Commonwealth
	Scientific and Industrial Research Organisation
	(CSIRO) from 2009 until November 2014. Prior to
	joining CSIRO, she was a director at NM Rothschild
	and Sons(Australia)and held seniorpositions at

	BHP, including vice president (Technology) and
	vice president (Health, Safety and Environment).
	Other directorships and offices (current and
	recent):
	• Deputy Chancellor of Monash University
	(since January 2021);
	• Chair of the Australian Space Agency
	Advisory Board (since January 2021);
	• Member of the Global Advisory Council of the
	Bank of America Corporation (since
	December 2019);
	• Director of Rio Tinto Limited and Rio Tinto Plc
	(since November 2014);
	• Member of the Australian Advisory Board of
	the Bank of America (since July 2010);
	• Former Head of the Australian Space Agency
	(from June 2018 to December 2020); and
	• Former Director of Care Australia Limited
	(from May 2015 to June 2020).
	Board Committee memberships:
	• Chair of the Human Resources and
	Remuneration Committee;
	• Member of the Corporate Governance and
	Nomination Committee; and
	• Member of the Innovation and Development
	Committee.
	Professor Cuthbertson has over 35 years’
	experience in medical research and biotech
	development with large biopharmaceutical
	companies and medical organisations. He also has
	Non-Executive director experience.
	Professor Cuthbertson joined CSL in April 1997 as
Andrew Cuthbertson AO	the director of research. Prior to CSL, he was a
BMedSci, MBBS, PhD, FAA,	senior scientist at Genentech Inc., a biotechnology
FTSE, FAHMS	company dedicated to pursuing ground-breaking
Non-independent Non-	science to discover and develop medicine for
Executive Director	people with life-threatening diseases. After
Director of CSL Limited	completing medical training at the University of
since October 2018, and	Melbourne and a PhD in immunology at the Walter
appointed Senior Adviser to	and Eliza Hall Institute in Australia, Professor
the CEO in July 2020.	Cuthbertson spent five years doing molecular
	biology research as a staff member at the Howard
	Florey Institute in Melbourne, Australia and the
	National Institutes of Health in Maryland, US. In
	2016, he was made an Officer of the Order of
	Australia and appointed Enterprise Professor at the
	University of Melbourne.
	Other directorships and offices (current and
	recent):
	• Member of the Council of the University of
	Melbourne (since January 2020);
	• Director of the Grattan Institute (since
	January 2019); and
	• Director of the Centre of Eye Research
	Australia(since March 2017).

	Board Committee membership:
	• Chair of the Innovation and Development
	Committee; and
	• Member of the Corporate Governance and
	Nomination Committee.
	Ms Hewson is a former investment banker with
	over 35 years’ experience in the finance sector. She
	was previously an executive director of Schroders
	Australia Limited and has extensive financial
	markets, risk management and investment
	management expertise.
Carolyn Hewson AO	She has long-term Non-Executive experience in a
BEc (Hons), MA	number of sectors bringing a breadth of
Independent Non-	experience and insight on strategy, capital
Executive Director	management and portfolio optimisation through
Director of CSL Limited	cycles, financial and non-financial risk, social value,
since	organisational culture and the changing external
December 2019.	environment.
	In 2009, Ms Hewson was made an Officer of the
	Order of Australia for her services to the broader
	community and to business.
	Other directorships and offices (current and
	recent):
	• Director of Reserve Bank of Australia (since
	April 2021);
	• Director of Infrastructure SA (since January
	2019);
	• Former Member of Federal Government
	Growth Centres Advisory Committee (from
	January 2015 to May 2021);
	• Former Director of BHP Group Limited and
	BHP Group Plc (from March 2010 to
	November 2019); and
	• Former Trustee Westpac Foundation (from
	May 2015 to May 2019).
	Board Committee memberships:
	• Chair of the Corporate Governance and
	Nomination Committee;
	• Member of the Audit and Risk Management
	Committee; and
	• Member of the Human Resources and
	Remuneration Committee.

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Duncan Maskell MA, PhD, FMedSci, Hon Assoc RSVC

Independent NonExecutive Director

Director of CSL Limited since August 2021.

Professor Maskell has wide-ranging international experience in science and commerce, with a particular focus in research, academia and entrepreneurship.

Professor Maskell is the vice-chancellor of the University of Melbourne. Prior to this he was senior pro-vice-chancellor at the University of Cambridge in the UK and has also held roles at the University of Oxford, Imperial College London and Wellcome Biotech.

Professor Maskell has extensive experience across the private sector, reflecting his passion for the commercialisation of research initiatives. He has co-founded several biotech companies, including Arrow Therapeutics, which was sold to

biopharmaceutical company AstraZeneca, and Discuva, which was sold to Summit Therapeutics. He has also served

as a Non-Executive Director of Genus Plc, a FTSE 250 company.

Professor Maskell holds a Master of Arts and a Doctor of Philosophy from the University of Cambridge.

Other directorships and offices (current and recent):

Director of the Grattan Institute (since November 2018);
Vice-Chancellor of the University of Melbourne (since October 2018);
Director of Melbourne Business School (since October 2018);
Director of the Group of Eight Limited (since October 2018); and
Director of Universities Australia Limited (since October 2018).

Board Committee membership:

Member of the Innovation and Development Committee.

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Marie McDonald BSc (Hons), LLB (Hons) Independent Non-Executive Director

Director of CSL Limited since August 2013.

Ms McDonald has significant executive and NonExecutive experience in a number of sectors including law, medical research, manufacturing and chemicals. Through these roles, Ms McDonald brings experience and insight on financial markets, risk and compliance and change management.

Ms McDonald is a former lawyer with over 30 years’ experience in the legal sector. She was previously a partner of Ashurst, specialising in mergers and acquisitions and corporate governance. She held the role of National Head of Mergers and Acquisitions and was Chair

of the Corporations Committee of the Business Law Section of the Law Council of Australia and a member of the Australian Takeovers Panel for nine years.

Other directorships and offices (current and recent):

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Alison Watkins AM BCom

Independent Non-Executive Director

Director of CSL Limited effective from August 2021.

•	Member of Melbourne University Law School
	Foundation Board (since October 2021);
•	Director of Nanosonics Limited (since October
	2016);
•	Director of Nufarm Limited (since March 2017);
	and
•	Director of the Walter & Eliza Hall Institute of
	Medical Research (since October 2016).
Board Committee memberships:
•	Member of the Audit and Risk Management
	Committee; and
•	Member of the Human Resources and
	Remuneration Committee.
Ms	Watkins brings deep experience to our Board
through the executive and Non-Executive roles she
has held across industries, including
manufacturing, agriculture, consumer goods, retail
and financial services.

Ms Watkins was most recently the group
managing director of ASX-listed Coca-Cola Amatil
Limited, where she was responsible for operations
in Australia, New Zealand, Indonesia and across the
South Pacific region.
Ms Watkins holds a Bachelor of Commerce from
the University of Tasmania, is a fellow of the
Institute of Chartered Accountants, the Financial
Services Institute of Australasia, and the Australian
Institute of Company Directors.
Other directorships and offices (current and
recent):
• Director Wesfarmers Limited (since
September 2021);
• Chancellor, University of Tasmania (since July
2021);
• Director of Reserve Bank of Australia (since
December 2020);
• Director of Centre for Independent Studies
(since December 2011);
• Former Director of Business Council of
Australia (from August 2015 to October 2021);
and
• Former Group Managing Director of Coca-
Cola Amatil Limited (from March 2014 to May
2021).
Board Committee memberships:
• Member of the Audit and Risk Management
Committee; and
• Member of the Human Resources and
Remuneration Committee.

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Fiona Mead LLB (Hons), BComm Company Secretary and Head of Corporate Governance

Ms Mead was appointed Company Secretary and Head of Corporate Governance effective June 2018. Previously, she was the company secretary and a member of the executive leadership team at Tabcorp Holdings Limited. Prior to that, Ms Mead was the company secretary at Asciano Limited, and earlier, assistant company secretary at Telstra. Fiona began her career as a lawyer with law firm Ashurst.

Ms Mead is a fellow of the Governance Institute of Australia and a graduate member of the Australian Institute of Company Directors.

Board committees

The Board has established a number of standing committees as a mechanism for considering detailed issues and, where appropriate, making recommendations for consideration by the Board. These committees have charters setting out matters relevant to the composition, responsibilities and membership of each committee.

Leadership team

Our Global Leadership Group is responsible for driving company performance so that we can keep our promises to our patients, our employees and our shareholders. They have earned their roles because of their experience, achievements, unwavering ethics and commitment to our core values.

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Paul Perreault BA (Psychology) Chief Executive Officer and Managing Director

Paul was appointed to the CSL Board in February 2013 and was appointed as the Chief Executive Officer and Managing Director in July 2013. He joined a CSL predecessor company in 1997 and has held senior roles in sales, marketing and operations with his most recent prior position being President, CSL Behring.

Paul has also worked in senior leadership roles with Wyeth, Centeon, Aventis Bioservices and Aventis Behring. He was previously chair of the global board for the Plasma Protein Therapeutics Association. Paul has had more than 37 years’ experience in the global healthcare industry.

The Harvard Business Review named Paul among the Top 100 Performing CEOs in the world during this fiscal year. See above for further biographical details.

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Joy Linton BComm; F. Fin; GAICD Chief Financial Officer

==> picture [126 x 71] intentionally omitted <==

Paul McKenzie PhD (Chemical Engineering) Chief Operating Officer

Joy was appointed Chief Financial Officer in March 2021.

Prior to joining CSL, Joy was chief financial officer and executive director at Bupa, a global health insurance company based in the UK, and earlier served as the general manager of health services for Bupa UK.

Joy has over 30 years’ experience in branded consumer businesses across insurance, healthcare and fast-moving consumer goods as a global and strategic chief financial officer.

Paul was appointed Chief Operating Officer in June 2019 and leads CSL’s global end-to-end operations organisation and its accompanying strategy. He has responsibility for manufacturing, quality, engineering, supply chain, procurement and environment, health and safety, as well as CSL Plasma and its network of collection centres in the US, China and Europe. Paul also has responsibility for CSL Seqirus.

Prior to joining CSL, Paul served as executive vice president of Pharmaceutical Operations and Technology at Biogen. With more than 25 years of experience, Paul held various senior roles in research and development and manufacturing for Johnson & Johnson, Bristol-Myers Squibb and Merck & Co. Paul holds a Bachelor of Science degree in chemical engineering from the University of Pennsylvania and a PhD in chemical engineering from Carnegie Mellon University. He was elected to the National Academy of Engineering in 2020.

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Bill Campbell BSc (Business Administration) Executive Vice President, Chief Commercial Officer

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Greg Boss JD, BS (Hon) Executive Vice President, Legal and CSL Group General Counsel

==> picture [128 x 72] intentionally omitted <==

Elizabeth Walker BA, MS (Organisational Development and Leadership) Executive Vice President, Chief Human Resources Officer

Bill was appointed Executive Vice President, Chief Commercial Officer in September 2017. He has responsibility for a variety of global functions, including sales, marketing, commercial development, medical affairs and policy, advocacy and government affairs. Prior to being appointed to his current role, Bill led CSL Behring’s North American commercial operations. He has more than 35 years of diverse pharmaceutical and biotechnology experience across a range of therapeutic areas, including oncology, women’s health, vaccines and plasma proteins. Bill has held senior management positions at a number of pharmaceutical and biotechnology companies. Greg was appointed Group General Counsel in 2009 and is responsible for worldwide legal operations for all CSL Group companies. He joined CSL in 2001, serving as general counsel for what became the CSL Behring business. In addition to his legal role, Greg is also responsible for overseeing global Risk Management and Compliance for the Group as well as global Corporate Communications. Prior to joining CSL, Greg was vice president and senior counsel for CB Richard Ellis International, after working 10 years in private legal practice. In 2016, Greg received the World Recognition of Distinguished General Counsel from the Directors Roundtable, and in 2017 Greg received the Leadership in Law award from the Burton Foundation. Elizabeth Walker leads Global Human Resources for the CSL Group of Companies and its people and culture strategy, supporting more than 30,000 employees around the world. Elizabeth joined CSL in 2016 and was appointed Chief Human Resources Officer in December 2017. Previously, she held a variety of HR leadership positions at Campbell Soup Company, most recently as Vice President of Global Talent Management. With a career spanning more than 30 years, she has extensive human resources and management consulting expertise and a distinguished record of results in growth businesses and M&A environments and within a diverse set of industries, including healthcare, financial services and consumer products. Elizabeth holds a Master of Science degree in organization development and leadership from St. Joseph’s University and a Bachelor of Arts degree from Carnegie Mellon University.

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Bill Mezzanotte MD, MPH Executive Vice President, Head Research & Development and Chief Medical Officer

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Mark Hill BA (Organisational Management) Executive MBA (Information Technology Management) Executive Vice President, Chief Digital Information Officer

As the Head of Research & Development (R&D) and Chief Medical Officer, Bill is responsible for developing and executing CSL’s R&D strategy and portfolio, creating the pipeline and R&D capabilities that will help the CSL Behring and CSL Seqirus businesses grow in the decades ahead. These R&D capabilities include identifying and developing all scientific platforms, skills and expertise necessary for success in rare and serious diseases and vaccines. Bill, who has been leading R&D since October 2018, initially joined CSL as head of clinical development in 2017. Prior to CSL, Bill was senior vice president and therapeutic area head for the respiratory unit for Boehringer Ingelheim and spent 16 years with AstraZeneca in research and development, assuming roles of increasing leadership and management responsibility across multiple therapeutic areas. Bill obtained his MD at the University of Pennsylvania and a Master of Public Health degree from Johns Hopkins University. He is board certified in internal medicine, pulmonary medicine, critical care medicine and sleep medicine. Since 2020, Bill has served as a member of the Board of Directors of the Philadelphia-based University City Science Center and in 2021 he joined the Board of Directors for BELLUS Health.

Mark Hill, chief digital information officer at CSL leads the enterprise-wide Digital Technology organisation and its accompanying strategy. Mark plays a key role in how CSL manages plasma donors, connects with patients, virtually collaborates and drives greater efficiencies in operations and the rest of the CSL organisation.

He is a global IT leader with extensive experience in utilising enabling technology to deliver efficiency, productivity, quality and solutions for patients and public health.

Prior to joining CSL, he was Senior Vice President and Chief Information Officer at Gilead Sciences, where he led the IT organisation during a period of rapid growth for the company and delivered key initiatives that encouraged collaboration and new ways of working. With more than 30 years of experience, Mark also held leadership roles with Merck and Schering-Plough earlier in his career. He earned his Bachelor of Science degree in Organizational Management from Tusculum College and his Executive MBA in Information Technology Management from Christian Brothers University. Mark is also a US Army veteran.

Allan Wills, former Executive Vice President, strategy and Business Development, resigned from CSL effective 30 November 2021

Ethics and transparency

While our CSL Values serve as the directional compass of our work, our Code of Responsible Business Practice (Code) provides a more detailed map to deliver on our promise to patients and public health in ways that exemplify the highest standards of conduct throughout the organisation.

CSL’s Code fosters a culture that rewards high ethical standards, personal and corporate integrity and respect for others.

Following the publication of the Board- endorsed 4th-edition Code on 1 July 2021, all employees were required to undertake training on the Code and CSL’s new ethics-based decision-making tool. These two e-learning modules were made available in 14 languages to cater for CSL’s global workforce.

In certain aspects of our business, such as the marketing of our products, our relationships with healthcare professionals or healthcare organisations and our research and development, we have made further commitments to comply with both local and internationally accepted pharmaceutical industry codes of conduct.

We expect third parties with which we work to comply with the applicable local laws and regulations of the countries in which they operate, and to observe all of the principles set out in our Code.

We have internal control systems to ensure financial statements comply with the applicable local laws of the countries in which we operate and to prevent fraud and other improper conduct.

CSL’s Code can be found on CSL.com (Our Company > Corporate Governance > Code of Responsible Business Practice).

Anti-Bribery and anti-corruption

CSL businesses and employees are prohibited from directly or indirectly offering, paying, soliciting or accepting bribes or giving or receiving personal favours, financial or other rewards or inducements in exchange for making business decisions. This prohibition applies regardless of the value of the reward or inducement. CSL policy also prohibits facilitation payments.

CSL operates in a diverse and complex marketplace where bribery and corruption are risks that could expose the organisation and employees to possible prosecution, fines and imprisonment. CSL has a number of commercial arrangements with governments and related agencies across various geographies.

Market practices are governed by company-specific policies and procedures. Internal compliance mechanisms and control systems are directly supported by our Global Ethics and Compliance team and subject to additional oversight by CSL’s Global Compliance Committee (GCC), regional committees, and CSL’s Audit and Risk Management Committee of the Board.

Based on these controls, CSL considers our overall risk relating to corruption to be low and are committed to ensuring full compliance in how we conduct our operations across all regions in which we operate and those we are seeking to enter.

From 1 July 2021 to 30 June 2022, 295 reports were identified for the attention of management through our global hotline. For substantiated allegations, corrective actions were taken to the extent warranted. For matters closed during the reporting period, no allegations resulted in any regulatory action or action by law enforcement authorities.

In addition, over the reporting period, an annual assessment of bribery and corruption risk was conducted. This was achieved by means of a standardised questionnaire that was completed and the responses reviewed with the GCC. During the reporting period, the assessments did not identify any material issues with the CSL’s management of corruption risks.

295 hotline reports received, as at 30 June 2022, with no allegations resulting in regulatory action or action by law enforcement authorities.

Fair competition

In April 2022, the Romanian Competition Council (RCC) issued a decision fining five pharmaceutical companies, including CSL Behring GmbH, as well as the representative trade association of the plasma protein sector (PPTA) for claimed coordinating actions on the market.

CSL Limited strongly disagrees with and contests the RCC’s findings and sanctions against the five companies and the trade association, and CSL has appealed the decision and will vigorously defend against the claims.

For more than 100 years, CSL has earned its reputation as a trusted, reliable and ethical global organisation. CSL is proud of its robust compliance program and has established a track record of operating in compliance with all applicable laws.

Political contributions

Over the reporting period, CSL contributed a total of A$9,100 to political organisations in Australia solely for attendance at events including policy briefings, lunches, boardroom lunches and dinners. In all other regions, CSL made no political contributions.

More at CSL.com (Our Company > Corporate Responsibility > Marketplace).

Sustainability performance

FTSE4Good

CSL’s environmental, social and governance (ESG) performance has been recognised by the FTSE4Good Index Series, a leading sustainability index, for the last 11 years.

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As of June 2022, CSL received an MSCI ESG Rating of A.

MSCI focuses on companies ESG rated performance in each sector to help institutional investors more effectively integrate ESG considerations into their investment processes, as well as manage, measure, and report on ESG mandates.

Sustainalytics

As of April 2021, CSL’s ESG risk rating overall score is 25.2 with an ESG risk rating category of medium (on a 5-point scale from negligible to severe), ranking 14 out of 372 in the biotechnology sector (1[st] equals lowest risk).

Sustainalytics provides analytical ESG research, ratings and data to institutional investors and companies.

Disclosure

As a publicly listed company on the Australian Securities Exchange (ASX), CSL has obligations under Australian law and the ASX Listing Rules. Subject to limited exceptions, we must continuously disclose to the ASX information about CSL that a reasonable person would expect to have a material effect on the price or value of CSL securities.

CSL has a policy that sets clear guidelines and describes the actions that the directors and all employees should take when they become aware of information that may require disclosure.

Corporate governance

Throughout 2021/22, CSL’s governance arrangements were consistent with the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations (4th edition). Our 2021/22 Corporate Governance Statement has been approved by the Board and is available on CSL.com (Our Company > Corporate Governance).

The Board continually reviews governance at CSL to ensure that our arrangements remain appropriate in light of changing expectations and general developments in good corporate governance.

Risk management

CSL has adopted and follows a detailed and structured Enterprise Risk Management Framework (ERMF) to ensure that risks in the CSL Group are identified, evaluated, monitored and managed. This ERMF sets out the risk management processes, internal compliance and monitoring requirements, governance processes and structures including roles and responsibilities for different levels of management, the matrix of risk impact and likelihood for assessing risk, the three lines of accountability for risk and risk management reporting requirements.

The ERMF has been established to provide reasonable assurance that:

any material exposure to risk is identified and adequately monitored and managed; and

significant strategic, emerging, financial, managerial and operating risk-related information is accurate, relevant, timely and reliable.

Further details of CSL’s risk management framework are contained in CSL’s Corporate Governance Statement.

A description of CSL’s material risks and key risk management activities for each risk can be found in Our Material Risks on page 26.

Tax transparency

While CSL’s roots are proudly Australian, CSL is a truly global company, with more than 90% of our revenues and profits derived outside Australia. We separately report on our global tax footprint, as part of our tax transparency reporting.

We are subject to the different tax regimes that apply in each of the countries in which we operate and comply with applicable taxation laws in those jurisdictions, including the OECD Country-by-Country reporting measures.

CSL’s approach to tax is underpinned by our Value of Integrity.

This is consistent with our commitment to complying with all tax laws in the countries in which we operate. CSL has a low appetite for tax risk and does not engage in aggressive tax planning.

CSL supports efforts to promote prevention of tax avoidance and to improve tax transparency in order to support a fairer economy and ensure there is confidence in the robustness of country tax regimes.

Operating with transparency forms a core part of CSL’s tax management philosophy and as such our annual tax transparency reports can be found on CSL.com (Our Company > Corporate Responsibility).

Directors’ Report

The Board of Directors of CSL Limited (CSL) has pleasure in presenting their report on the consolidated entity for the year ended 30 June 2022.

1. Principal activities, strategy and operating model

The principal activities of the consolidated entity during the financial year were the research, development, manufacture, marketing and distribution of biopharmaceutical products and vaccines.

CSL is a leader in global biotechnology, and develops and delivers innovative medicines that save lives, protect public health and help people with life-threatening medical conditions to live full lives. CSL’s strategy is delivered through its five strategic objectives for 2030: focus; innovation; efficiency and reliable supply; sustainable growth; and digital transformation. More detail on CSL’s performance against its 2030 strategic objectives can be found in Performance and Strategy.

CSL’s operating model for its businesses leverage multifunctional teams that connect to share best practice. CSL’s operating model is based around four key value creation activities: early stage research, product translation, manufacturing and patient access. CSL’s commercial and functional areas operate at a global level, with the Global Leadership Group responsible for the day-to-day management of the group and delivery of CSL’s strategic objectives. More detail on CSL’s operations can be found in Our Company and Performance and Strategy.

On 9 August, CSL acquired Vifor Pharma (Vifor). As at the date of this report, the integration of Vifor to align with CSL’s operating model is underway. Further details on the Vifor business and the acquisition can be found on page 10 of this report and Note 2 and Note 23 of the Financial Statements.

2. Operating and financial review

CSL discloses financial performance primarily by business. This provides the most meaningful insight into the nature and financial outcomes of CSL’s activities and facilitates greater comparability against industry peers. Information on the operations and financial position for CSL and likely developments in the Group’s operations in future financial years is set out in the Operating and Financial Review (OFR). The OFR consists of the Chair and CEO messages (including the Vifor Acquisition), Our Performance and Strategy, Our Company, Our Material Risks, Our Future Prospects and Our Governance accompanying this Directors’ Report.

3. Directors

The directors who served at any time during 2021/22 or up until the date of this Directors’ Report were Dr Brian McNamee AO, Mr Paul Perreault, Professor Andrew Cuthbertson AO, Mr Bruce Brook, Ms Carolyn Hewson AO, Dr Megan Clark AC, Ms Marie McDonald, Professor Duncan Maskell and Ms Alison Watkins AM.

Further details of the current directors are set out in the Governance section of CSL’s 2021/2022 Annual Report or on CSL.com. These details include the period for which each director held office up to the date of this Directors’ Report, their qualifications, independence, experience and particular responsibilities, the directorships held in other listed companies since 1 July 2019 and the period for which each directorship has been held.

Professor Duncan Maskell and Ms Alison Watkins were appointed as a Non-executive Directors of CSL with effect from 18 August 2021.

4. Company Secretary

Ms Fiona Mead, BCom/LLB (Hons) FGIA, GAICD, was appointed and commenced in the position of Company Secretary and Head of Corporate Governance on 4 June 2018 and continues in office as at the date of this report. Ms Mead was previously the company secretary and a member of the executive leadership team at Tabcorp Holdings Limited. Prior to that, she was the company secretary at Asciano Limited. Ms Mead also served as assistant company secretary at Telstra Corporation.

5. Director’s attendance at meetings

The Board meets as often as necessary to fulfil its role. Directors are required to allocate time to CSL to perform their responsibilities effectively, including adequate time to prepare for Board meetings. During the reporting year, the Board met 10 times, with all of those meetings held in Australia.

Members of the Global Leadership Group and other members of senior management attend Board meetings by invitation. Attendance at Board and standing Board committee meetings during 2021/22 is set out in Table 1 below. Due to COVID-19 restrictions, the directors also leveraged virtual technologies to participate in focused sessions on the CSL Group’s operations inside and outside Australia and meet with local management.

Table 1: 2021/22 Director attendance at Board and Committee meetings

											Corporate	Corporate
								Human			Governan
			Audit	and			Resources		Innovation		ceand
				Risk	Securities			and		and	Nominatio
	Board	of	Manageme nt		andMarket Disclosure		Remunerati on		Developme nt		n Committe
	Directors		Committee		Committee		Committee		Committee			e
	A	B	A[1]	B	A	B	A[2]	B	A	B	A	B
B McNamee	10	10		5*	3	3		7*	4	4	4	4
B Brook	10	10	5	5				2*		4*	4	4
C Hewson	10	10	5	5			7	7		4*	4	4
M Clark	10	10		4*			7	7	4	4	4	4
A Cuthbertson	10	10		4*				7*	4	4	2	2
												2*
M McDonald	10	10	5	5			7	7		4*
D Maskell	9	8		1*				1*	4	4
A Watkins	9	9	3	3			5	5		4*
P Perreault	10	10		5*	3	3		7*	4	4*		4*

A Number of meetings held whilst a member.

B Number of meetings attended. Board Committee meetings are open to all directors to attend. Where a director attended a meeting of a committee of which they were not a member, it is indicated with an asterisk*.

[1] One of the Audit and Risk Management Committee meetings was held jointly with the Human Resources and Remuneration Committee.

[2] One of the Human Resources and Remuneration Committee meetings was held jointly with the Audit and Risk Management Committee.

6. Dividends

On 16 August 2022, the directors resolved to pay a final dividend of US $1.18 per ordinary share, 10% franked, bringing dividends per share for 2022 to US $2.22 per share. In accordance with determinations by the directors, CSL does not operate a dividend investment plan.

Dividends paid during the year were as follows:

			Amount	Total
	Date	Franking	per share	dividend
Dividend	paid	per share	US$	US$
Final dividend for year ended 30	30/09/2021	10% franked at	1.18 cents	$537.7m
June 2021		30% tax rate
Interim dividend for year ended	06/04/2022	Unfranked	1.04 cents	$501.0m
30 June 2022

Dividends are determined after period-end and announced with the results for the period. Interim dividends are determined in February and paid in April. Final dividends are determined in August and paid in October. Dividends determined are not recorded as a liability at the end of the period to which they relate.

7. Developments in operations in future years and expected results

The OFR sets out information on CSL’s business strategies and prospects for future financial years, and refers to likely developments in CSL’s operations and the expected results of those operations in future financial years. Certain information regarding developments in operations in future years and expected results of those operations is excluded because it is likely to result in material prejudice to the Group.

8. Significant changes and subsequent events

Other than as disclosed in the OFR, the directors are not aware of any significant changes in the consolidated entity’s state of affairs during the year or to the Group’s principal activities during the year.

Other than the acquisition of Vifor (see Vifor Acquisition on page 10 of this report and Note 2 and Note 11 of the Financial Statements) and information as disclosed in Note 23 of the Financial Statements, the directors are not aware of any other matter or circumstance which has arisen since the end of the financial year which has significantly affected or may significantly affect the operations of the Group, results of those operations or the state of affairs of the Group in subsequent financial years.

9. EHS and sustainability performance

CSL has an Environmental, Health and Safety (EHS) Management System that ensures its facilities operate to industry and regulatory standards. This system includes compliance with government regulations and commitments for continuous improvement of health and safety in the workplace, as well as minimising the effect of operations on the environment. As part of our commitment to continuously improving our EHS performance, a global review of our management system against ISO 14001 and 45001 was conducted this financial year with implementing an update to the system planned for FY2022/23.

Development, implementation and improvement of employee health and safety processes and programs continue to focus on enhancement of a strong and inclusive

safety culture. Our Australian operations continue classification as an established licensee in respect to CSL’s self-insurance licence as granted by the Safety, Rehabilitation and Compensation Commission.

CSL continues to operate in compliance with domestic and foreign laws, regulating environmental, health and safety obligations. Including all applicable emissions and waste generation and disposal requirements. Government agency audits and facility inspections monitor CSL environmental, health and safety performance. No material findings were identified over the reporting period.

In 2021, CSL, Parkville (Australia) submitted a remediation feasibility study and cleanup plan for identified groundwater contamination to the environmental authority in response to an EPA clean up notice. The EPA confirmed the site has complied with the notice requirements. CSL continues to monitor and engage with EPA on the next steps to close out this issue.

As part of compliance and continuous improvement in regulatory and voluntary environmental performance, CSL continues to report on key environmental aspects, including energy consumption, emissions, water use and management of waste as part of CSL’s annual reporting on CSL.com (see Corporate Responsibility) and submission to the CDP (previously known as Carbon Disclosure Project). CSL has met its reporting obligations under the Australian Government’s National Greenhouse and Energy Reporting Act (2007) and Victorian Government’s Industrial Waste Management Policy (National Pollutant Inventory).

Continuously monitoring environmental health and safety performance, climate change risks, and control measures means that CSL is ready for new and emerging regulatory requirements. CSL’s environmental performance is particularly important and relevant to select stakeholders and CSL reaffirms its commitment to continue to participate in initiatives such as CDP’s (climate change and water disclosures) to help inform investors of its environmental management approach and performance.

Additional EHS performance details, including workplace safety, can be found in Our Future Prospects, in the Global Reach and Impact section of the 2022 Annual Report and on CSL.com.

10.Directors’ shareholdings and interests

The interests of the directors in the shares, options and performance rights of CSL are set out in the Remuneration Report – Tables 11 and 12 for executive key management personnel (KMP) and Tables 17 and 18 for Non-Executive Directors. It is contrary to Board policy for KMP to limit exposure to risk in relation to these securities. From time to time the Company Secretary makes inquiries of KMP as to their compliance with this policy.

11. Directors’ interests in contracts

Section 13 of this report sets out particulars of the Director’s Deed entered into by CSL with each director in relation to access to Board papers, indemnity and insurance.

12.Performance rights and options

As at 30 June 2022, the number of unissued ordinary shares in CSL under options and under performance rights are set out in Note 6 and Note 19 of the Financial Statements. Holders of options or performance rights do not have any right, by virtue of the options or performance rights, to participate in any share issue by CSL or any

other body corporate or in any interest issued by any registered managed investment scheme. The number of options and performance rights exercised during the financial year and the exercise price paid to acquire fully paid ordinary shares in CSL is set out in Note 6 of the Financial Statements. Since the end of the financial year, no shares were issued under CSL’s Performance Rights Plan. Since the end of the financial year, there has been no change to the information contained in Note 8 or Note 19 to the Financial Statements. Since the end of the financial year, 6,378 Restricted Share Units have been forfeited due to participant cessation of employment. There has been no change to the information contained in Note 18 to the Financial Statements.

13. Indemnification of directors and officers

During the financial year, the insurance and indemnity arrangements discussed below were in place concerning directors and officers of the consolidated entity.

CSL has entered into a Director’s Deed with each director regarding access to Board papers, indemnity and insurance. Each deed provides:

an ongoing indemnity to the relevant director against liability incurred by that director as an officer of CSL or a related body corporate. The indemnity is given to the extent permitted by law and to the extent and for the amount that the relevant director is not otherwise entitled to be, and is not actually, indemnified by another person or out of the assets of a corporation, where the liability is incurred in or arising out of the conduct of the business of that corporation or in the discharge of the duties of the director in relation to that corporation;
that CSL will purchase and maintain an insurance policy which covers directors against liability as a director and officer of CSL and its directors. Coverage will be maintained for a minimum of seven years following the cessation of office for each director; and
the relevant director with a right of access to Board papers in connection with any relevant proceedings.

In addition to the Director’s Deeds, Rule 95 of CSL’s constitution requires CSL to indemnify each ‘officer’ of CSL and of each wholly owned subsidiary of CSL out of the assets of CSL ‘to the relevant extent’ against any liability incurred by the officer in or arising out of the conduct of the business of CSL or in the conduct of the business of such wholly owned subsidiary of CSL or in the discharge of the duties of the officer, unless incurred in circumstances which the Board resolves do not justify indemnification. Further details are set out in the Constitution, available on CSL.com (Our Company > Corporate Governance).

CSL paid insurance premiums in respect of a contract insuring each individual director of CSL and each full time executive officer, director and secretary of CSL and its controlled entities, against certain liabilities and expenses (including liability for certain legal costs) arising as a result of work performed in their respective capacities, to the extent permitted by law.

14. Indemnification of auditors

To the extent permitted by law, CSL has agreed to indemnify its auditors, Ernst & Young, as part of the terms of its audit engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment has been made to indemnify Ernst & Young during or since the financial year. No insurance premiums were paid for Ernst & Young during the financial year.

15.Auditor independence and non-audit services

CSL may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor’s expertise and experience with CSL and/or the consolidated entity are important.

Details of the amounts paid or payable to the entity’s auditor, Ernst & Young, for nonaudit services provided during the year are set out below. The directors, in accordance with the advice received from the Audit and Risk Management Committee, are satisfied that the provision of non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001 for the following reasons:

all non-audit services have been reviewed by the Audit and Risk Management Committee to confirm that they do not affect the impartiality and objectivity of the auditor; and
none of the services undermine the general principles relating to auditor independence as set out in Professional Statement F1, including reviewing or auditing the auditor’s own work, acting in a management or a decision making capacity for CSL, acting as an advocate for CSL or jointly sharing economic risks and rewards.

A copy of the auditors’ independence declaration as required under section 307C of the Corporations Act 2001 accompanies this report.

Ernst & Young and its related practices received or are due to receive the following amounts for the provision of non-audit services to CSL and its subsidiaries in respect to the year ended 30 June 2022:

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The role of the Audit and Risk Management Committee of the CSL Board of Directors (ARMC) is to oversee the integrity and quality of half-year and full-year financial reporting and disclosures. A key responsibility arising from this role is the

appointment of the Company’s independent auditor, including the selection, review and evaluation of the audit signing partner(s) and the negotiation of audit fees.

In accordance with its Charter and with CSL’s commitment to best practice corporate governance practices, the ARMC regularly reviews the performance of the Company’s independent auditor.

Matters considered in reviewing the performance of the Company’s independent auditor in the 2022 financial year included:

A. the professional qualifications and effectiveness of the auditor, the audit signing partner(s) and other key engagement partners;
B. the auditor’s historical and recent performance on the Company’s audit, including the extent and quality of their communications with the ARMC;
C. an analysis of the auditor’s known legal risks and significant proceedings that may impair its ability to perform CSL’s annual audit;
D. the appropriateness of the auditor’s fees;
E. the auditor’s independence policies and its processes for maintaining its independence and objectivity;
F. the auditor’s tenure as the Company’s independent auditor and its depth of understanding of the Company’s global business, operations and systems, accounting policies and practices, including the potential effect on the financial statements of the major risks and exposures facing the Company, and internal control over financial reporting; and
G. the auditor’s capability, expertise and efficiency in handling the breadth and complexity of CSL’s global operations.

The current audit signing partners for CSL’s auditor, Ernst & Young is Ms Kylie Bodenham.

In line with an observed trend in many jurisdictions towards a tenure limit for audit firms, CSL completed its competitive external audit tender process during FY2021/22. The Company has recommended the appointment of Deloitte Touche Tohmatsu as the Company’s external auditor commencing for the year ending 30 June 2024, subject to regulatory and shareholder approval.

16. Rounding

The amounts contained in this report and in the financial report have been rounded to the nearest hundred thousand dollars (where rounding is applicable) unless specifically stated otherwise under the relief available to the Company under ASIC Corporations Instrument 2016/191. CSL is an entity to which the Instrument applies.

Ernst & Young 8 Exhibition Street Melbourne VIC 3000 Australia GPO Box 67 Melbourne VIC 3001

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Tel: +61 3 9288 8000 Fax: +61 3 8650 7777 ey.com/au

Auditor’s Independence Declaration to the Directors of CSL Limited

As lead auditor for the audit of the financial report of CSL Limited for the financial year ended 30 June 2022, I declare to the best of my knowledge and belief, there have been:

a. No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit;
b. No contraventions of any applicable code of professional conduct in relation to the audit; and
c. No non-audit services provided that contravene any applicable code of professional conduct in relation to the audit.

This declaration is in respect of CSL Limited and the entities it controlled during the financial year.

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Ernst & Young

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Kylie Bodenham Partner 16 August 2022

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

17. Remuneration Report

Dear Fellow Shareholder,

On behalf of the Board of Directors, I am pleased to present CSL’s Remuneration Report (Report) for the financial year ended 30 June 2022 (2022). This Report contains detailed information regarding CSL’s Key Management Personnel (KMP) for 2022.

CSL plays a critical role in the global community – providing life-saving therapies to people with serious disease, and vaccines that protect public health. The Board is proud of the entire CSL team for delivering on this during 2022.

Delivering on our Promise in 2022

Under the leadership of our Chief Executive Officer and Managing Director (CEO), Mr Paul Perreault, CSL has again has shown resilience in its 2022 results.

Remaining focused on our promise to patients and public health means we have delivered:

Net Profit after Tax (NPAT) of US$2,254.7m, in line with expectations;
An increase in Revenue of 2% to US$10,561.9m;
Cashflow from Operations (CFO) of US$2,628.7m;
An annual ROIC of 18.1%;
Earnings per Share (EPS) of US$4.81;
Significant growth in Research and Development (R&D) investment and R&D pipeline progression;
27 new plasma centres opened, taking the global total to 330; and
Completion of the acquisition of Vifor Pharma AG (Vifor) on 9 August 2022.

2022 Key Management Personnel Changes

Ms Alison Watkins AM and Professor Duncan Maskell joined the Board as Non-Executive Directors (NED) in August 2021.

In October 2021, Professor Andrew Cuthbertson AO retired from his role as Executive Director and Senior Advisor to the CEO. We are pleased to retain Professor Cuthbertson's extensive experience in medicine, science, research and development and he was re-elected by shareholders as a non-independent NED.

2022 CEO Remuneration Outcomes

In 2022, Mr Perreault received an increase in Fixed Reward of 3%, taking this to US$1,803,530 effective 1 September 2021. Mr Perreault's short term incentive (STI) target was held at 120% of Fixed Reward and his long term incentive (LTI) target remained at 400% of Fixed Reward.

Mr Perreault will receive a STI payment of US$3,029,931 for performance in 2022. The

outcome is 140% of Mr Perreault’s target reflecting below target performance on NPAT, a strong above target CFO outcome and an individual performance outcome that was above target. Mr Perreault also led the team in the successful US$11.7b acquisition of Vifor throughout 2022 which was completed shortly following the end of the financial year, adding a growth pillar to CSL. Details of these outcomes can be found in section 6 of the Report.

In 2022, LTI awards granted to Mr Perreault over the period October 2017 to September 2020 had partial vesting and he received shares worth US$7,775,435 (based on the face value of the award at the date of vesting). Further detail can be found in sections 6.4 and 8.2.

The 2022 ‘realised’ remuneration for Mr Perreault was US$12,710,883 and was a 72% decrease from 2021 (full detail is provided in section 8.2, Table 13). This lower outcome was driven by the end of legacy LTI Option and Performance Right awards (granted at fair value) that had previously vested through until 2021, and saw significant growth in value over the period from grant to vesting.

2022 CEO Realised Remuneration

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0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Total Fixed Reward Received
Total STI Received
LTI Received - Performance Share Units (2018)
LTI Received - Performance Share Units (2019)
LTI Received - Performance Share Units (2020)
LTI Received - Performance Share Units (2021)
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Board Discretion Applied to Remuneration

The Board reviewed the quality of earnings, impact of COVID-19 and risk management outcomes across the year. As the Vifor acquisition was not contemplated at the time of setting the targets at the start of the financial year, the Board used its discretion to remove the Vifor acquisition costs and benefits (including favourable hedging activities) for the calculation of STI outcomes. Further detail is provided in section 6.1. The Leading and Managing Modifier was not applied in 2022.

Remuneration Framework Changes Introduced in 2022

As communicated last year, following a review of the remuneration framework aimed at ensuring a fit for purpose design, alignment to our Total Reward Principles and responding to feedback from our investors, in 2022 the following changes were introduced:

Maximum STI - Increase of the maximum STI payout from 150% to 200% of STI target opportunity – driving our pay for performance

philosophy, incentivising for outperformance and aligning to our global pharmaceutical/ biotechnology peers;

LTI Performance Measures - Introduction of a second LTI measure of EPS growth – aligned to shareholder experience. This second measure ensures focus on long term sustainable earnings growth and is aligned to market practice and investor expectations; and
LTI Vesting Period - Removal of vesting of awards at years one, two and four to a single point, three year vest. Responding to investor feedback, this also aligns with the approach taken by our global pharmaceutical/ biotechnology peers.

During 2022, the Human Resources and Remuneration Committee (HRRC) reviewed the Malus and Clawback Policy to ensure appropriate provisions were included and the policy was in line with market practice. Changes were made to further strengthen and articulate the circumstances for which an adjustment may be made.

Remuneration in 2023

As discussed in prior year Reports and across investor meetings, the Board continues to review and adjust the reward of Executive KMP to drive reward positioning towards the median of our global pharmaceutical/ biotechnology peer group.

For 2023, the Board has determined that Mr Perreault will receive a 3.5% increase to Fixed Reward, no change in STI target and an increase in his LTI target to 450%, from 400% of Fixed Reward. This change to LTI target is a step towards bringing our CEO's Total Target Reward to the median of our global pharmaceutical/biotechnology peer group, positioning him at 81% of the median (or 50th percentile) in 2023.

For our remaining Executive KMP, in 2023 an increase to Fixed Reward of 3.7% and 3.5% will be applied to Ms Joy Linton, our Chief Financial Officer and Dr Paul McKenzie, our Chief Operating Officer, respectively. There will be alignment of the STI targets across the Executive team and Ms Linton's STI target will increase to 100% of Fixed Reward. As we continue to drive towards median Total Target Reward among our global pharmaceutical/ biotechnology peers, both Ms Linton and Dr McKenzie will have an increase to LTI targets. Ms Linton's target will increase to 225% of Fixed Reward and Dr McKenzie to 425% of Fixed Reward.

Following benchmarking against ASX12 and ASX25 NED remuneration, there will be an increase in fees of 3% for all Board and Committee roles, effective 1 July 2022. The

increase enables CSL to offer a competitive fee to attract and retain experienced directors.

Embedding Environment, Social and Governance in our Remuneration in Framework

Effective 1 July 2022, we will introduce a global sustainability measure into our STI plan. In 2023 the measure will include milestones that:

Establish a robust program governance process;
Undertake global initiatives that reduce CO2 emissions;
Incorporate sustainable design in our new facilities: and
Engage with our supply partners to achieve a low emission supply chain.

The measure, with a 5% weighting, will be in addition to measures already included in the individual key performance indicators for Executive KMP and Executives. In addition to the financial measures of NPAT and CFO, this will ensure collective focus and accountability on our long term sustainability and global footprint. The weighting of the two financial measures for Executive KMP remains unchanged. The weighting of the individual objective component will be reduced. See section 4 for more detail.

In competing for talent in a global market, it is critical that we have a remuneration framework that attracts and retains high quality talent to deliver on our strategy and deliver results. The Board believes that our current design meets this requirement. However, we keep this under review each year.

We appreciate the feedback received from investors. As we evolve our executive remuneration framework we will continue to review our program both from a competitive design perspective and ensuring an appropriate target quantum for Executives that positions us at the median of our global pharmaceutical/biotechnology peer group. The Board will review sustainability on an annual basis to determine the appropriate weighting, measure, target and alignment to either STI or LTI. As we look to Board succession we will need to ensure our NED fee pool is set at the appropriate level.

Thank you to my fellow HRRC members and thank you for supporting CSL and the patients we serve around the world.

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Dr Megan Clark AC Chair

Human Resources and Remuneration Committee

CSL Key Management Personnel
2022 Key Management Personnel Remuneration Outcomes at a Glance
Global Remuneration Framework
Remuneration Framework Changes in 2023
CSL Performance and Shareholder Returns
Executive Key Management Personnel Outcomes in 2022
Executive Key Management Personnel Statutory Remuneration Tables
2022 and 2023 Executive Key Management Personnel Remuneration
Non-Executive Director Remuneration
Remuneration Governance
Additional Employee Equity Programs and Legacy Plan Information

Independent Audit of the Report

The Remuneration Report (Report) has been audited by Ernst & Young (EY). Please see page 39 of the Financial Statements for EY’s report.

1. CSL Key Management Personnel

This Report sets out remuneration information for CSL's Key Management Personnel (KMP) which includes Non-Executive Directors (NEDs), the Executive Director (i.e. the Chief Executive Officer and Managing Director (CEO)) and those key senior executives who have authority and responsibility for planning, directing and controlling the activities of CSL during the financial year (together with the Executive Director, herein referred to as Executive KMP). The CSL KMP during the financial year ended 30 June 2022 (2022) and changes to KMP are outlined in Table 1. Each of the KMP listed in Table 1 held their position for the full reporting period, unless stated otherwise.

Table 1: CSL Key Management Personnel in 2022

Table 1: CSL Key Management Personnel in 2022
Non-Executive Directors	Executive Key Management Personnel
Chairman -Dr Brian McNamee AO	Executive Director and Chief Executive Officer and
	Managing Director (CEO) -Mr Paul Perreault
Mr Bruce Brook	Chief Financial Officer -Ms Joy Linton
Dr Megan Clark AC	Chief Operating Officer (COO) -Dr Paul McKenzie
Professor Andrew Cuthbertson AO - appointed 2
October 2021
Ms Carolyn Hewson AO	Former Executive Key Management Personnel
Professor Duncan Maskell - appointed 18 August 2021	Executive Director and Senior Advisor to the CEO -
	Professor Andrew Cuthbertson AO - retired as an
	Executive 1 October 2021
Ms Marie McDonald
Ms Alison Watkins AM - appointed 18 August 2021

2. 2022 Key Management Personnel Remuneration Outcomes at a Glance

CEO	• A 3% increase to Fixed Reward (FR) • A short term incentive (STI) payment of US $ 3,029,931 – 70% of maximum opportunity • Partial long term incentive (LTI) vesting during the year of US$7,775,435 (face value at vesting date) • Received ‘realised’ remuneration of US$ 12,710,883
Other Executive KMP	J Linton (Chief Financial Officer) • Received an increase to FR of 3.4% (inclusive of the superannuation guarantee increase) • STI of US$1,149,742 was paid - 72% of maximum opportunity • LTI vesting of US$2,361,849 (face value at vesting date) • 'Realised' remuneration in 2022 of US$4,473,431
	P McKenzie (COO) • Received an increase to FR of 3% • STI of US$1,273,770 was paid - 65% of maximum opportunity • Partial LTI vesting of US$3,453,773 (face value at vesting date) • 'Realised' remuneration in 2022 of US$5,788,887
NEDs	• The Board and Committee Chair roles received an average increase to fees of 4.2% and an average 2.8% was applied to Board and Committee member fees (within the existingfee cap)

3. Global Remuneration Framework

3.1 Global Total Rewards Principles

To deliver on our promise to patients and to protect public health, we rely on our people and we need to ensure a strong supply of global talent. Our Total Rewards Principles enable us to attract, engage and retain talent, provide us with the flexibility to address talent challenges in various markets and allow us to compete with other large global pharmaceutical companies. We motivate our people to deliver their best performance by enabling an approach that integrates market competitive and differentiated reward programs that align to CSL’s strategy and business objectives.

Common Global Structure	Common Global Structure	Effort Matters	Effort Matters
•	We leverage a market-based approach to	•	We celebrate and recognise both the effort
	offer competitive rewards, balancing		that is required along the way as well as the
	both a global and local view		real results created by our employees
•	We align employee and shareholder
	interests, and consider community
	expectations
•	We benchmark ourselves against the life
	sciences industry*
•	We have a single pay design for all senior
	executives
Results and Behaviours		Holistic Approach to Well-Being
•	We are committed to a pay for	•	We foster an environment of well-being that
	performance culture based on both role		is multi-dimensional – physical, emotional,
	requirements and how the individual		financial and social health
	performs
•	Living our CSL Values is a non-negotiable
	expectation
Internal Equity, Inclusive Culture		Simplicity and Clarity
•	We reward fairly and competitively	•	We aim to create easy to understand
•	We strive and monitor for equal pay for equal work		programs and policies so people value and use them
		•	We are committed to transparency in our
			communications – internally and externally

*CSL Plasma is benchmarked against the Retail Industry

3.2 Remuneration Framework

CSL's remuneration framework combines elements of traditional Fixed Reward (or base salary), STI and LTI plans with enhancements to several design factors to suit CSL’s business, a very different business to other companies in Australia, and with a diverse global employee and shareholder base. Our international footprint requires global leadership and, with executives based in different countries, we need to ensure our framework is fair, equitable and market competitive in the countries and industry in which we operate in order to attract and retain highly talented people.

3.2.1 2022 Remuneration Framework Elements for Executive KMP

3.2.1 2022 Remuneration Framework Elements for Executive KMP	3.2.1 2022 Remuneration Framework Elements for Executive KMP
Fixed Reward (FR) Short Term Incentive (STI) Long Term Incentive (LTI)
Purpose	Attract, retain and engage key talent to deliver our CSL strategy Reward performance against annual Key Performance Indicators (KPIs) – maintaining a focus on underlying value creation within the business operations is critical to CSL's success and sustainability Alignment to the longer term performance and strategy of CSL, building economic alignment between Executive KMP and shareholders over the long term
Structure	Cash – salary and superannuation/pension Cash Performance Share Units
Approach	Paid throughout the year and reviewed annually Determined based on the scope, complexity and responsibilities of the role, experience and performance Reviewed through both an internal and external relativity lens Peer group – global pharmaceutical/biotechnology peers or a general industry view depending on role (desired positioningat the median) Paid annually Maximum payout is 200% of an Executive KMP's target STI opportunity (i.e. STI target multiplied by 200%) Outcomes based on business (60%) and individual performance measures (40%) Granted annually with vesting following the end of the three year performance period The performance measures are Return on Invested Capital – measured on a seven year rolling return in the year the award vests (70%) and Earnings Per Share Growth - measured over the three year life of the award (30%)
Peer Group	The global pharmaceutical/biotechnology industry peer group serves as a primary reference group for remuneration benchmarking, created such that CSL falls in the middle of the group with respect to market capitalisation and revenue. The group represents global industry peers and is updated annually. The peer group in 2022 included: AbbVie Inc.; Alexion Pharmaceuticals, Inc.; Allergan plc; Amgen Inc.; AstraZeneca PLC; Bausch Health Companies Inc.; Bayer Aktiengesellschaft; Biogen Inc.; BioMarin Pharmaceutical Inc.; Bristol-Myers Squibb Company; Eli Lilly and Company; GlaxoSmithKline plc; Gilead Sciences Inc.; Grifols, S.A.; Merck Kommanditgesellschaft auf Aktien; Novo Nordisk A/S; Regeneron Pharmaceuticals, Inc.; Takeda Pharmaceutical Company; UCB SA and Vertex Pharmaceuticals Incorporated. For the 2023 year, Moderna Inc. has been added and Alexion Pharmaceuticals, Inc. and Allergan plc were removed In addition, two general industry reference groups representing Australia and North America also help us appropriately reward senior talent and may be used as a primary, or hybrid, data set for certain Executive KMP dependent on role and location
Risk Management	Before determining remuneration outcomes and vesting, we assess alignment with risk management outcomes to hold executives accountable for effective risk management – both financial and non-financial. In addition, all variable reward is subject to the Malus and Clawback Policy and the Board has full discretion over the outcome of any variable reward payment and vesting The Board has the discretion to apply a ‘Leading and Managing’ modifier to STI and LTI outcomes – formally recognising the importance of CSL’s culture including leadership behaviours, values, diversity objectives, sustainability and management of risk. The modifier allows for the Board to adjust in exceptional circumstances upwards by up to 20% or downwards by up to 50% of annual STI earned, and/or LTI opportunity granted. The modifier is also available to adjust STI and LTI outcomes for risk management outcomes under our formal risk/consequence management framework. The Board has a discretion in all circumstances, including a significant risk management failure, to reduce awards and/or vesting outcomes further, including to zero
Malus and Clawback	Executive KMP STI and LTI arrangements are subject to malus and clawback provisions that enable the Board to adjust both vested and unvested awards as appropriate. The circumstances include material misstatement or omission in financial statements, fraud, dishonesty, adverse risk management outcomes, violation of any material law or regulation, material violation of CSL’s Code of Conduct or any other policy governing the conduct of employees or any other serious and wilful misconduct
Shareholding Requirement	Executive KMP must hold CSL shares equal to 100% of FR (300% for the CEO) within five years from the date of appointment to their role
Benefits	We also provide market competitive benefits to attract and retain key talent. Benefits may include, but are not limited to, accident, disability and death insurance, health insurance, car parking, globalparental and caregiver leave, select vaccinations andparticipation in local benefitprograms

The Board retains discretion across all elements of the remuneration framework.

3.2.2 Remuneration Delivery Timeline

The diagram below illustrates how the components of the 2022 Executive KMP remuneration are delivered over a four year period.

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3.2.3 Pay Mix

The following diagrams set out the remuneration mix for Executive KMP in 2022. The majority of the target reward mix is variable reward (STI and LTI) and is at risk. This better aligns Executive KMP rewards with shareholder interests and is aligned to our pay for performance philosophy, focusing efforts on driving growth and long term performance and sustainability. For his period of employment in 2022, Professor Cuthbertson was not eligible for variable reward under the executive remuneration framework due to the nature of his advisory role.

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Remuneration Mix - P Perreault (CEO) Remuneration Mix - A Cuthbertson (Senior
Advisor to CEO)
Maximum 14% 32% 54%
Maximum 100%
Target 16% 19% 65% Target 100%
Minimum 100% Minimum 100%
Fixed Reward STI LTI Fixed Reward STI LTI
Remuneration Mix - J Linton (Chief Remuneration Mix - P McKenzie (COO)
Financial Officer)
Maximum 15% 31% 54%
Maximum 22% 38% 39%
Target 28% 23% 49% Target 18% 18% 64%
Minimum 100% Minimum 100%
Fixed Reward STI LTI Fixed Reward STI LTI
----- End of picture text -----

From a market alignment perspective, within our global pharmaceutical/biotechnology peer group our Executive KMP reward is generally competitive in the elements of FR and STI. LTI remains below market comparators for all roles, including the CEO, resulting in Total Target Direct Compensation (FR + target STI + target LTI) below the median (refer to section 8 for detail).

3.2.4 Short Term Incentive (STI)

Rewarding performance over an annual period, the STI program is designed to drive business performance and the creation of shareholder value. The KPIs on which Executive KMP are assessed and rewarded are challenging and not just duties expected in the normal course of their role.

In 2022, following a review of the STI program, the Board approved the increase of the maximum payout opportunity from 150% of target to 200%. This change ensures a more competitive offering, aligning to our global pharmaceutical/biotechnology peers and also incentivises outperformance, driving a pay for performance culture. Maximum reward will only be earned for truly outstanding performance. The change also addresses attraction and retention issues in key growth markets, including the U.S.

In the 2022 financial year, sustainability metrics continued to form part of Executive KMP individual KPIs. When the Board assessed the STI outcomes for Executive KMP they reviewed the sustainability outcomes of the organisation and considered the application of discretion through the 'Leading and Managing' modifier to address any underperformance for the organisation - the Board deemed no adjustment was required in 2022.

The key features of the STI program for the year ended 30 June 2022 (to be paid in September 2022) are detailed below.

Feature	Description
Performance Period	Annual award aligned with the financial year – 1 July 2021 to 30 June 2022
Award	Cash
Performance Measures	Each Executive KMP has a maximum of six KPIs. The KPIs are made up of two financial measures, common to all participants – Net Profit after Tax (NPAT) and Cash Flow from Operations (CFO), plus up to four individual business building KPIs. Hurdles are set at threshold, target and maximum levels of performance and there is significant difference between under achieve/achieve/over achieve targets and measures, so that a challenging but meaningful incentive is provided for target performance. The performance measures are chosen to ensure Executive KMP are focused on the achievement of the CSL strategy, deliveryof business results and CSL's success and sustainability
	Financial Individual
	Financial growth is the foundation of long term sustainability and evidences our competitive advantage, whilst pursuing profitable growth, and aligns employee and shareholder objectives. The financial performance measures are NPAT measured at constant currency and CFO measured at the reported rate Individual performance hurdles align with strategic priorities, encourage appropriate decision making, and balance performance in non-financial priorities. The individual performance measures are based on individual responsibilities and categories include divisional performance, achievement of strategic objectives and improvement in operations, risk management, compliance, people, health and safety, ESG and quality
Performance Measure Weighting	The weighting of the measures for Mr Perreault and Dr McKenzie is NPAT 35%, CFO 25% and Individual 40%. For Ms Linton, the weighting of measures is NPAT 30%, CFO 30% and Individual 40%
Executive KMP STI Targets Set as a percentage of FR, target opportunity in 2022 was: • Mr Perreault - 120% • Ms Linton - 85% • Dr McKenzie – 100%
Vesting 50% earned on threshold level performance, increasing on a straight line basis with 100% earned at target level performance and 200% on achievement of maximum level performance (capped at 200%). The STI Outcome percentages are then multiplied by the KPI weighting and individual STI opportunity (as disclosed in Table 3 in section 6.2) to determine the payment amount
Cessation of Employment A ‘qualified leaver’ (for example someone who retires or is made redundant) may receive a pro-rata payment paid in the ordinary course based on the portion of the Performance Period worked, subject to Performance Measures being met. If the Executive KMP is not a ‘qualified leaver’, no payment will be made unless the Board determines otherwise

For the 2023 financial year (2023), a global sustainability measure for which all Executives will be held accountable will be added, in addition to any relevant individual sustainability KPI measures. The weighting in 2023 will be 5%, reflecting CSL's sustainability roadmap as baseline targets are set for future measurement (section 4 provides more detail on this measure for 2023). Each Executive KMP and Global Leadership Group member will also continue to have sustainability objectives that form part of their workplans and expected role deliverables, in most cases, not rewarded through STI.

3.2.5 Long Term Incentive (LTI)

In 2022, two changes were made to the LTI plan, reflecting feedback received from investors and to encourage alignment of executives’ equity interests with shareholders over the longer term.

We introduced a second performance measure of Earnings Per Share growth (EPSg) to complement the current Return on Invested Capital (ROIC) measure. This change also responded to investor feedback on our single metric. The EPSg measure is weighted 30% of the LTI and the ROIC measure is weighted 70%.

We also moved from tranche vesting over a four year period to single point vesting following the end of a three year performance period. This approach aligns with the most prevalent approach taken by our global pharmaceutical/biotechnology peers and also responds to investor feedback regarding the previous vesting schedule.

When our target performance is achieved, we want our executives’ LTI to vest – we set targets that require excellent outcomes for shareholders both absolutely and relative to the performance of our global peers. The LTI plan also rewards and assists us in retaining our talent. The key features of the program for 2022 LTI awards, granted 1 September 2021, are as follows.

Feature	Description
Summary	A conditional ‘right’ to a CSL share or at the Board’s discretion in exceptional circumstances, a cash
	equivalent payment. No price is payable by the Executive KMP on grant or vesting of rights. Shares
	are allocated (or cashpaid) on vestingwithout the need for exercise byan Executive KMP
Security	Performance Share Unit (PSU)
Grant	To determine the number of PSUs issued, a five day volume weighted average share price is used.
Methodology	The LTI opportunity for each Executive KMP is divided by the calculated allocation price to
	determine the number of securitiesgranted
Performance	• Tranche 1 - ROIC 70%
Measure	• Tranche 2 - EPSg30%
ROIC Gateway	No vesting will occur in Tranche 1 unless an Investment Hurdle Rate (IHR) is achieved in the year of
Performance	testing. The IHR is the minimum return CSL requires on its investments to ensure it is making sound
Measure	investment decisions and appropriatelymanagingrisk and coveringits cost base
Performance	• Tranche 1 ROIC - Seven year average 1 July 2017 to 30 June 2024
Period	• Tranche 2 EPSg– 1 July2021 to 30 June 2024
Performance	• Tranche 1 ROIC - Threshold at 20.0% and Target at 21.4%
Target	• Tranche 2 EPSg- Threshold at 5.0% and Target at 8.3%
Executive KMP	• Mr Perreault – 400% of FR
LTI Target Opportunity1	• Ms Linton - 175% of FR • Dr McKenzie – 350% of FR
Vesting	50% earned on threshold level performance, increasing on a straight line basis with 100% earned at
Schedule	target level performance (maximum vesting capped at 100%). The Board has the discretion to adjust
	vestingoutcomes
Vesting Date	1 September 2024
Retesting	No retest of any tranche
Cessation of	A ‘qualified leaver’ (for example someone who retires or is made redundant) retains a pro-rated
Employment	number of PSUs based on time elapsed since grant date. Retained PSUs will remain subject to
	original terms and conditions including satisfaction of performance conditions at the test date. If an
	Executive KMP is not a ‘qualified leaver’, all unvested PSUs will lapse unless the Board determines
	otherwise
Change of	In the event of a change of control, the Board, in its absolute discretion, may determine that some
Control	or all of the PSUs vest having regard to the performance of CSL during the performance period to
	the date of the change of control event. Vesting may occur at the date of the change of control
	event or an earlier vesting date as determined by the Board
Dividends and	No dividends or dividend equivalents are paid on unvested PSUs. Executive KMP are only eligible for
Voting Rights	dividends once shares have been allocated following vesting of any PSUs. PSUs do not carry any
	votingrightsprior to vestingand allocation of shares

3.2.6 Leading and Managing Modifier

The Board, taking into consideration recommendations from the CEO for Executive KMP, and the Human Resources and Remuneration Committee (HRRC) for the CEO, has the discretion to apply a ‘Leading and Managing’ modifier to both the STI and LTI opportunity – allowing for recognition of extraordinary contribution in exceptional circumstances or significant leadership failure across sustainability, risk management, culture and diversity. Applied to the overall STI outcome or LTI target opportunity, there can be an increase of up to 20% or a decrease of up to 50% applied. In 2022, the modifier was not applied.

In addition to consideration during the determination of KPI outcomes, the modifier is also utilised for the assessment of the appropriate management of risk – both financial and non-financial. In consultation with the Audit and Risk Management Committee (ARMC), the HRRC uses a principles approach to ensure alignment between remuneration outcomes and performance. This enables management to bring awareness to behaviours that encourage unacceptable levels of risk and discourage those behaviours, promotes behaviours that encourage acceptable levels of risk and enables the Board to recognise and appropriately address both acceptable and unacceptable behaviours. In the event of a significant risk management failure, the Board has the discretion to adjust STI and LTI outcomes downwards, including to zero.

1Also maximum opportunity.

4. Remuneration Framework Changes in 2023

Sustainability changes - CSL is committed to a healthier world. Our vision is a sustainable future for our employees, communities, patients and donors, inspired by innovative science and a values-driven culture. In 2021 we adopted a sustainability strategy that is based on the three pillars of Environment, Social and Sustainable Workforce, and for the focus areas prioritised under each of the three pillars, in 2022 we have developed a number of actions to validate data sets and baselines.

Ensuring a global shared focus on our long term sustainability and global footprint consistent with our CSL purpose and values, from 1 July 2022 a CSL Group sustainability metric has been applied to the STI component of variable reward. Weighted at 5% (noting there will be a reduction in the individual KPI weighting of 5% to include this KPI), all Executives will be held accountable for objectives shown below that are in support of CSL's goal of reducing carbon emissions by 2030. Detailed milestones and outcomes will be disclosed in the 2023 Remuneration Report.

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The Board will review on an annual basis to determine the appropriate weighting, measure, target and component of variable reward to align sustainability to (i.e. STI or LTI).

5. CSL Performance and Shareholder Returns

5.1 Financial Performance from 2016 to 2022

The following graphs[2] summarise key financial performance over the past seven financial years. We have disclosed over a seven year period to align with our ROIC LTI performance measurement period.

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----- Start of picture text -----

Net Profit After Tax/Earnings Per Cash Inflow From Operating Annual Return on Invested
Share (USD) Activities (millions USD) Capital
2,500 600 4,000 35%
2,000 30%
1,500 400 3,000 25%
1,000 200 20%
500 2,000
0 0 15%
2016 2017 2018 2019 2020 2021 2022 1,000 10%
5%
Net Profit After Tax (millions) – USD 0 0%
Earnings Per Share (cents) – USD 2016 2017 2018 2019 2020 2021 2022 2016 2017 2018 2019 2020 2021 2022
Closing Share Price (at 30 June Total Dividends per Share
AUD) / Total Shareholder Return (cents USD)
50%
300 40% 250
200 30%
20% 200
100 10%
0 0% 150
(10)% 100
2016 2017 2018 2019 2020 2021 2022
50
Closing Share Price (dollars) – AUD 0
Total Shareholder Return (12 month %) - AUD
2016 2017 2018 2019 2020 2021 2022
----- End of picture text -----

2 The 2016 Annual Return on Invested Capital figure includes the gain on acquisition of Novartis’ global influenza vaccine business of US$176.1m. The opening share price on 1 July 2017 was A$138.03. The Total Shareholder Return outcome at 30 June 2022 was -4.60%. The Total Dividends per Share is the actual total dividends paid within the financial year. 62

6. Executive Key Management Personnel Outcomes in 2022

6.1 CSL and Executive KMP Performance

In 2022, CSL has demonstrated resilience in its results, delivering solid performance outcomes. As expected, NPAT was down from the prior year, reflecting lower plasma collection in 2021. However, the outcome was in line with expectations and at the top end of market guidance. We continue to progress our research and development pipeline and have grown investment in this area over the year ensuring innovation for a sustainable business. Revenue increased 3.5% at constant currency. CFO was also down on prior year due to higher plasma costs and strong plasma collection during 2022. CFO did however exceed target through strong underlying cash earnings and good working capital management.

The NPAT at 30 June 2022 resulted in performance below target and our CFO achieved an above target performance outcome. The Board reviewed the quality of earnings, including the impact of COVID-19 across supply and inventory, and risk management outcomes across the year. As the Vifor Pharma AG (Vifor) acquisition was not contemplated at the time of setting the targets at the start of the financial year, the Board used its discretion to adjust the outcomes of both NPAT and CFO associated with the Vifor acquisition net costs. The CFO outcome was also adjusted to remove the impact of the favourable cash inflow resulting from the Treasury hedging activity associated with the Vifor acquisition. The Leading and Managing Modifier was not used in 2022.

The following performance outcomes were achieved resulting in an average overall STI payment outcome of 125% of target level opportunity across the Executive KMP (see Table 3). The minimum STI earned as a percentage of target level opportunity was 105% and the maximum was 140% – the latter was 70% of the maximum STI outcome that could be achieved. Additional objectives, which were also integral to the achievement of individual performance, were considered by the Board when assessing Executive KMP performance. However, these remain confidential for commercial reasons.

Table 2: Achievements in 2022

Table 2: Achievements in 2022
Measure and Commentary	Threshold	Target	Maximum
	50%	100%	200%
Financials
• NPAT
• CFO
People
• Completion of the organisational transformation across the Enabling
Functions providing a sustainable base and improved scalability
• Transformation of an integrated global R&D business
• Strong progress against the 2022 diversity, inclusion and equity
targets furthering progress to attainment of FY25 and FY30 goals
• Recognised by Forbes magazine as one of America's best employers
• Recognised as one of Australia and New Zealand's Best Places to
Work by The Australian Financial Review
• Launch of the CSL Promising Futures scholarship program
Innovation
• Agreement to acquire Vifor - acquisition completed in August 2022
• 24 product registrations or new indications for serious disease across
the CSL Group portfolio
• Garadacimab Phase III study enrolment completed for HAE
• CSL112 (ApoA-1) Phase III study (AEGIS-II) progressing with >80% enrolment achieved and 3rdinterim analysis completed
• Pre-clinical assessment of next generation, self-amplifying mRNA
vaccine in season and pandemic influenza
• FLUCELVAX® Quadrivalent approvals - US and Argentina 6m+
indication, Australia 2y+ extension and New Zealand 9y+ extension • FLUAD®Quadrivalent Phase III study in adults 50-64y enrolment
completed
• EtranaDez (Haem B gene therapy) primary end point achieved in
HOPE-B study with MAA (EU) and BLA 9US) submitted
• Completed manufacturing of the AstraZeneca COVID-19 vaccine in
Australia

Threshold Target Maximum 50% 100% 200%

Measure and Commentary

Focus

Collaboration with StartX as an Innovation Partner to support entrepreneurs in the StartX community as they commercialise innovative technologies and develop novel therapeutics

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Collaboration with WEHI and the University of Melbourne to create a biotech start-up incubator in CSL’s new global headquarters in Melbourne
Lengnau mechanical completion and transition to Thermo Fisher Scientific management

Efficiency and Reliable Supply

27 plasma centres opened taking the global total to 330
US regulatory clearance received for the new plasmapheresis platform with rollout to be completed by the end of 2023

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Progress against key milestones on our quality system integration initiative
Record volume of ~135 million doses distributed in our 2022 influenza campaign
Fill and finish capacity expansion projects at our Liverpool and Holly Springs sites completed
Progression of capital expansion projects including the new cell culture influenza vaccine facility in Australia
New safety system live across all locations
Above target delivery against the IG roadmap

Digital Transformation

Progression of the converged enterprise network strategy across CSL and Seqirus
Initiation of our next generation Donation Management System initiative

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Enhanced CSL Plasma Donor app with new functionality
Significantly enhanced partnership with Capgemini
Milestones achieved in our digital transformation to build capabilities in digital experiences, and insights and analytics

6.2 STI Outcomes by Executive KMP in 2022

The financial performance of CSL (NPAT and CFO) makes up the majority weighting of the KPIs for Executive KMP – 60%, incentivising the delivery of strong financial performance.

Achievements that contributed to the outcomes detailed in Table 3 below can be found in Table 2 of this Report. The Board made no adjustments under the Malus and Clawback Policy and no risk management, behaviour or compliance issues involving Executive KMP were identified during the joint consultation between the HRRC and ARMC.

Table 3: STI Outcomes in 2022

					STI Earned
	Value of		Maximum	STI Earned	as % of	STI
	STI	Target STI	STI	as % of	Maximum	Earned	Financial	Individual
	Earned	Opportunity	Opportunity	Target	Opportunity	as % of	Performance	Performance
Executive	US$	as a % of FR	as a % of FR	Opportunity	3	FR	Outcome	Outcome
P Perreault	3,029,931	120 %	240 %	140 %	70 %	168 %	Between Target	Between Target
							and Maximum	and Maximum
J Linton	1,149,742	85 %	170 %	105 %	72 %	122 %	Between Target	Between
							and Maximum	Threshold and
								Target
P McKenzie	1,273,770	100 %	200 %	130 %	65 %	130 %	Between Target	Between
							and Maximum	Threshold and
								Target

3 Any STI that was not earned was automatically forfeited.

6.2.1 CEO 2022 STI Achievement and Outcome

The Board considered the following highlights when determining the STI outcome for Mr Perreault.

Table 4: CEO STI Outcomes in 2022

Table 4: CEO STI Outcomes in 2022
Measure and Commentary	Weight	Threshold	Target	Maximum	% of Maximum
		50%	100%	200%	Opportunity
Financials
• Solid adjusted NPAT result against target	35%	US$2,125m	US$2,361m	US$2,597m	47.5%
• Strong adjusted CFO outcome exceeding target	25%				96.5%
		US$2,028m	US$2,253m	US$2,591m
Stabilise plasma business fundamentals and return	20%				65.0%
to sustainable growth
• Plasma collection improvement on 2021
• US regulatory clearance received for the new
plasmapheresis platform and progression of the
partnership with Terumo – delay of implementation
due to supply chain constraints
• Transformation of an integrated global R&D
function across CSL and Seqirus
• Execution of merger and acquisition deals with
significant achievement on the Vifor acquisition
Deliver growth and efficiency initiatives and build a	10%				87.5%
robust pipeline of safe and effective life-saving
medicines
• Above target outcomes on IG roadmap
• Improvement in all safety metrics over prior year –
TRIFR improvement across most functions/sites
• Readiness for new product launches across the end
to end supply chain and commercial operations
• Significant progress on the sustainability strategy
and roadmap
• Lengnau mechanical completion and transition to
Thermo Fisher Scientific management
People and Culture	10%				75.0%

People and Culture

Key succession plan milestones advanced

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Diversity, Equity and Inclusion objectives delivered ensuring trending toward achievement of longer term goals

6.3 LTI Outcomes by Executive KMP in 2022

6.3.1 LTI Awards Tested in 2022

In 2022, in the course of annual performance testing, five LTI grants were tested. The table below shows the performance of CSL against the targets with vesting occurring in September 2021 and March 2022.

Table 5: LTI Awards Tested in 2022

				Exercise		Vesting
Grant Date	Security	Tranche	Performance Period	Price A$	Performance Outcome	Outcome
1 October 2017	PSU	4	1 July 2014 – 30 June 2021	-	Seven year ROIC at 25.1%	68.33%4
1 September 2018	PSU	3	1 July 2014 – 30 June 2021	-	Seven year ROIC at 25.1%	68.33%5
1 September 2019	PSU	2	1 July 2014 – 30 June 2021	-	Seven year ROIC at 25.1%	100%
1 September	PSU	1	1 July 2014 – 30 June 2021	-	Seven year ROIC at 25.1%	100%
2020
1 April 2021	PSU	1	1 July 2014 – 30 June 2021	-	Seven year ROIC at 25.1%	100%
1 April 2021	RSU	1	1 April 2021 - 1 March 2022	-	Individual performance	100%

4 The remaining 31.67% of this tranche has lapsed - there is no retest.

5 The remaining 31.67% of this tranche has lapsed - there is no retest.

6.3.2 Fair Value of Awards Granted, Vested and Lapsed Equity in 2022

The table below details the fair value at the date of grant for all awards granted[6] , vested and lapsed in 2022. The values are shown in Australian Dollars (A$).

Table 6: Grant Fair Value

Table 6: Grant Fair Value
Security	Tranche	Grant Date	Vest/Lapse	Expiry Date	Fair Value at
			Date		Grant A$
PSU	4	1 Oct 2017	1 Sep 2021	1 Oct 2024	124.60
PSU	3	1 Sep 2018	1 Sep 2021	1 Oct 2024	219.41
PSU	4	1 Sep 2018	1 Oct 2021	1 Oct 2024	216.13
PSU	2	1 Sep 2019	1 Sep 2021	1 Oct 2029	230.50
PSU	3	1 Sep 2019	1 Oct 2021	1 Oct 2029	228.14
PSU	4	1 Sep 2019	1 Oct 2021	1 Oct 2029	225.80
PSU	1	1 Sep 2020	1 Sep 2021	1 Sep 2025	287.79
PSU	1	1 Apr 2021	1 Sep 2021	1 Apr 2026	265.48
PSU	1	1 Sep 2021	1 Sep 2024	1 Sep 2026	302.44
PSU	2	1 Sep 2021	1 Sep 2024	1 Sep 2026	302.44
Restricted Share Unit (RSU)	1	1 Apr 2021	1 Sep 2021	1 Apr 2026	265.48
RSU	2	1 Apr 2021	1 Mar 2022	1 Apr 2026	264.08

6.3.3 Summary of Executive KMP Granted, Vested and Lapsed Equity in 2022

The table below summarises the details of equity awards granted, vested and lapsed in US Dollars (US$) for each Executive KMP. For awards granted, the maximum number of securities that may vest is shown. For accounting purposes, the maximum value of each grant is the fair value of the equity granted multiplied by the number of equity instruments granted, or remaining each year. Ultimately, the maximum value of the equity awards will be equal to the number of securities granted multiplied by the CSL share price at the time of vesting. The minimum number of securities and the value of the equity awards is zero if the equity award is fully lapsed. Details of the performance and service criteria applying to awards granted in prior years are summarised in section 11 and prior Remuneration Reports corresponding to the reporting period in which the awards were granted.

The April 2021 grants were awarded to Ms Linton as a commencement benefit, providing a more competitive reward offering and compensating for a pro-rata portion of the loss of cash settled LTI awards held by Ms Linton at her cessation of employment with Bupa. Further detail is disclosed in the 2021 Remuneration Report.

6 The grant date of PSUs granted to P Perreault was 13 October 2021. Shareholder approval for the grant of PSUs and any shares to be issued at the time of vesting, was obtained under ASX Listing Rule 10.14 at the 2021 Annual General Meeting. 66

Table 7: Movement in Equity in 2022

Executive	Security Tranche Grant Date Vesting Date Exercise Price A$ Fair Value at Grant US$ Face Value at Grant US$7 Granted Vested Lapsed Face Value at Vest – Vested Award US$8 Face Value at Lapse – Lapsed Award US$9
P Perreault	PSU 4 1 Oct 2017 1 Sep 2021 — 1,180,425 1,269,098 13,013 8,892 4,121 2,000,844 927,292
	PSU 3 1 Sep 2018 1 Sep 2021 — 1,495,436 1,549,280 9,362 6,398 2,964 1,439,654 666,948
	PSU 2 1 Sep 2019 1 Sep 2021 — 1,832,164 1,942,441 11,077 11,077 — 2,492,504 —
	PSU 1 1 Sep 2020 1 Sep 2021 — 1,715,523 1,679,101 8,188 8,188 — 1,842,433 —
	PSU 1 1 Sep 2021 1 Sep 2024 — 4,876,594 4,983,659 22,148
	PSU 2 1 Sep 2021 1 Sep 2024 — 2,089,969 2,135,853 9,492
A Cuthbertson	PSU 4 1 Oct 2017 1 Sep 2021 — 191,310 205,681 2,109 1,442 667 324,473 150,086
	PSU 3 1 Sep 2018 1 Sep 2021 — 357,326 370,192 2,237 1,529 708 344,050 159,312
	PSU 4 1 Sep 2018 1 Sep 2021 — 351,828 370,027 2,236 — 465 — 97,791
	PSU 2 1 Sep 2019 1 Sep 2021 — 354,458 375,792 2,143 2,143 — 482,209 —
	PSU 3 1 Sep 2019 1 Sep 2021 — 355,932 375,792 2,143 — 595 — 125,130
	PSU 4 1 Sep 2019 1 Sep 2021 — 352,117 375,617 2,142 — 981 — 206,307
J Linton	PSU 1 1 Apr 2021 1 Sep 2021 — 632,974 627,061 3,275 3,275 — 736,928 —
	PSU 1 1 Sep 2021 1 Sep 2024 — 1,121,388 1,146,007 5,093
	PSU 2 1 Sep 2021 1 Sep 2024 — 480,658 491,211 2,183
	RSU 1 1 Apr 2021 1 Sep 2021 — 414,767 410,893 2,146 2,146 — 482,885 —
	RSU 2 1 Apr 2021 1 Mar 2022 — 1,155,070 1,150,346 6,008 6,008 — 1,142,036 —
P McKenzie	PSU 2 1 Sep 2019 1 Sep 2021 — 1,210,906 1,265,383 7,216 4,931 2,285 1,109,555 514,162
	PSU 2 1 Sep 2019 1 Sep 2021 — 761,348 807,173 4,603 4,603 — 1,035,749 —
	PSU 2 1 Sep 2019 1 Sep 2021 — 316,746 335,811 1,915 1,915 — 430,906 —
	PSU 1 1 Sep 2020 1 Sep 2021 — 817,115 799,767 3,900 3,900 — 877,563 —
	PSU 1 1 Sep 2021 1 Sep 2024 — 2,329,967 2,381,122 10,582
	PSU 2 1 Sep 2021 1 Sep 2024 — 998,526 1,020,449 4,535

7 Securities granted multiplied by the closing CSL share price on the date of grant. The A$ value was converted to US$ at an average exchange rate for the 2022 financial year of 1.37359.

8 Securities vested multiplied by the closing CSL share price on the date of vest. All awards were automatically exercised on vesting. The A$ value was converted to US$ at an average exchange rate for the 2022 financial year of 1.37359. 9 Securities lapsed multiplied by the closing CSL share price on the date of lapse. The A$ value was converted to US$ at an average exchange rate for the 2022 financial year of 1.37359. 67

6.3.4 Executive KMP 2023 Equity Vesting Opportunity

Four awards will be tested in 2023. The following tables set out a preview of these awards with Table 9 providing the specific grant details for each Executive KMP. The face value in Table 8 is provided in A$.

Table 8: LTI Awards to be Tested in 2023

				Face Value of a CSL Share
Grant Date	Security	Performance Measure Exercise Price A$		at Date of Grant A$
1 September 2018	PSU	ROIC	—	227.31
1 September 2019	PSU	ROIC	—	240.87
1 September 2020	PSU	ROIC	—	281.68
1 April 2021	RSU	Individual	—	263.00
		Performance

Table 9: Executive KMP LTI Opportunity to be Tested in 2023

Table 9: Executive KMP LTI	Opportunity to be Tested in 2023
Executive	Number of Performance Share Units	Number of Restricted Share Units
P Perreault	28,628	—
J Linton	—	5,097
P McKenzie	15,069	—

7. Executive Key Management Personnel Statutory Remuneration Tables

Remuneration is reported in US$, unless otherwise stated. This is consistent with the presentation currency used by CSL.

7.1 Executive KMP Remuneration 2021 and 2022

Table 10: Statutory Remuneration Disclosure – Executive KMP

Executive	Year10	Short Term Benefits Post Employment Other Long Term Share Based Payments11
		Cash Salary and Fees12 Cash Bonus US$13 Cash Sign On US$ Non- Monetary US$14 Super US$ Long Service Leave US$ Performance Rights US$ Performance Share Units US$ Restricted Share Units US$ Total US$ % Performance Related

P Perreault - CEO and Managing Director	2022	1,733,962 3,029,931 — 92,441 18,300 — — 4,987,494 — 9,862,128 81 %
	2021	1,697,123 1,807,032 — 95,083 20,300 — (66,026) 6,570,910 — 10,124,423 82 %
J Linton - Chief Financial Officer15	2022	874,803 1,149,742 — 81,479 25,689 21,583 — 699,401 1,540,207 4,392,904 77 %
	2021	281,781 288,464 78,220 122,927 6,786 6,840 — 384,315 708,425 1,877,757 74 %
P McKenzie - Chief Operating Officer	2022	965,230 1,273,770 — 67,972 16,802 — — 2,577,351 — 4,901,125 79 %
	2021	989,079 1,028,970 — 70,140 22,123 — — 3,684,975 — 5,795,287 81 %
Former Executive KMP
A Cuthbertson - Senior Advisor to CEO16	2022	128,811 — — — 4,550 2,855 — (97,619) — 38,597 (253) %
	2021	505,666 483,067 — 32,648 18,579 11,603 (14,490) 723,043 — 1,760,117 68 %
TOTAL	2022	3,702,806 5,453,443 — 241,892 65,341 24,438 — 8,166,627 1,540,207 19,194,754 79 %
	2021	3,473,649 3,607,533 78,220 320,798 67,788 18,443 (80,516) 11,363,243 708,425 19,557,584 80 %

10 The A$ compensation paid during the years ended 30 June 2021 and 30 June 2022 have been converted to US$. For the 30 June 2022 compensation, this has been converted to US$ at an average exchange rate for the 2022 financial year: A$ – 1.37359. For the 2021 compensation, this has been converted to US$ at an average exchange rate for the 2021 financial year: A$ – 1.34557. Both the amount of remuneration and any movement in comparison to prior years may be influenced by changes in the exchange rates. No termination benefits were paid in 2022.

11 The Performance Rights have been valued using a combination of the Binomial and Black Scholes option valuation methodologies including Monte Carlo simulation as at the grant date adjusted for the probability of hurdles being achieved. The Performance Share Units and Restricted Share Units have been valued using the Black Scholes option valuation methodology. These valuations were undertaken by Deloitte and PricewaterhouseCoopers. The amounts disclosed have been determined by allocating the value of the Performance Rights, Performance Share Units and Restricted Share Units over the period from grant date to vesting date in accordance with applicable accounting standards. Share based payments have been converted to US$ at an average exchange rate for the 2022 financial year: A$ – 1.37359. There were no Options expensed or outstanding in 2021 or 2022.
12 Includes cash salary, cash allowances and short term compensated absences, such as annual leave entitlements accrued but not taken during the year.
13 The cash bonus in respect of 2022 is scheduled to be paid in September 2022. The cash component of the cash bonus received in 2021 was paid in full in September 2021 for all Executive KMP as previously disclosed, with no adjustment.
14 Includes any health benefits, insurances benefits and other benefits. For International Assignees and domestic and international relocations, this may include personal tax advice, health insurance, removalists, temporary accommodation and other expatriate assignment benefits.
15 In 2021 J Linton was an Executive KMP for the period 5 March 2021 to 30 June 2021.
16 In 2022 A Cuthbertson was an Executive KMP for the period 1 July 2021 to 1 October 2021.

7.2 Executive KMP Shareholdings

Details of shares held directly, indirectly or beneficially by each Executive KMP, including their related parties, are provided in Table 11. Details of Options, Performance Rights, Performance Share Units and Restricted Share Units held directly, indirectly or beneficially by each Executive KMP, including their related parties, are provided in Table 12. Any amounts are presented in US$. Following the vesting of awards, any trading undertaken by Executive KMP was subject to the Group Securities Dealing Policy (outlined in section 10.6). Approved trading disclosed was actioned in accordance with the Policy, including forced trades to cover CSL tax withholding obligations.

Table 11: Executive KMP Shareholdings

Table 11: Executive	KMP Shareholdi	ngs
		Number of Shares
		Acquired on
		Exercise of	Value of Shares
		Options,	Acquired on Exercise
		Performance	of Options,
		Rights, PSUs or	Performance Rights,	Number of
	Balance at 1	RSUs during year	PSUs or RSUs during	(Shares Sold) /	Balance at 30
Executive	July 2021	US$	year US$17	Purchased	June 2022
P Perreault	163,241	34,555	7,775,435	(31,495)	166,301
J Linton	—	11,429	2,361,849	118	11,547
P McKenzie	10,651	15,349	3,453,773	(5,326)	20,674
Former Executive	KMP
A Cuthbertson18	106,579	5,114	1,150,732	—	111,693

There have been no movements in shareholdings of Executive KMP between 30 June 2022 and the date of this Report.

Table 12: Executive KMP Option, Performance Right, Performance Share Unit and Restricted Share Unit Holding

Executive	Security Balance as at 1 July 2021 Number Granted Number Exercised Number Lapsed Balance as at 30 June 2022 Number Vested During Year	Balance as at 30 June 2022
		Vested19 Unvested
P Perreault	PSU 97,719 31,640 34,555 7,085 87,719 34,555	— 87,719
J Linton	PSU 3,275 7,276 3,275 — 7,276 3,275	— 7,276
	RSU 13,647 — 8,154 — 5,493 8,154	— 5,493
P McKenzie	PSU 45,107 15,117 15,349 2,285 42,590 15,349	— 42,590
Former Executive KMP
A Cuthbertson20 PSU 13,010 — 5,114 3,416 4,480 5,114		— 4,480

17 The value of Performance Share Units and Restricted Share Units at the exercise date has been determined by the share price at the close of business on the exercise date multiplied by the number of securities exercised during 2022. The A$ value was converted to US$ at an average exchange rate for the year of 1.37359.

18 The closing balance for A Cuthbertson is at 1 October 2021 being the date A Cuthbertson ceased to be Executive KMP. 19 Vested awards are exercisable to the Executive KMP. There are no vested and unexercisable awards. 20 The closing balance for A Cuthbertson is at 1 October 2021 being the date A Cuthbertson ceased to be Executive KMP.

8. 2022 and 2023 Executive Key Management Personnel Remuneration

8.1 CEO Target Remuneration

The Board determines any increases to reward for the CEO based on his performance and relative to external benchmarks. When comparing Mr Perreault’s total reward to the reward of CEOs across the pharmaceutical/ biotechnology peer group, Mr Perreault lags the median – specifically on the LTI component, currently sitting at 81% of the Total Target Direct Compensation median.

8.1.1 2022 CEO Target Remuneration

In 2022, the Board determined that Mr Perreault would receive a 3% increase to FR, taking this to US$1,803,530. Mr Perreault’s STI percentage remained set at 120% of his FR for target performance and his maximum payout opportunity capped at 240% of his FR for outstanding performance. This maximum opportunity was increased from 180% in the prior year due to the framework change where the Board increased the maximum STI opportunity to 200% of target from 150%. There was no increase applied to his LTI target, remaining at 400% of FR (also maximum opportunity). However, given FR has increased the monetary value of the maximum opportunity has increased.

8.1.2 2023 CEO Target Remuneration

In 2023, the Board has determined that Mr Perreault will receive a 3.5% increase to FR - US$1,866,654 effective 1 September 2022. There will be no change to Mr Perreault's STI target, remaining at 120% with a maximum opportunity of 240%. An increase in the LTI target from 400% of FR to 450% of FR has been applied - this is also the maximum opportunity. These changes increase Mr Perreault's Total Target Direct Compensation from US$11,181,886 to US$12,506,582.

8.2 2022 Executive KMP Realised Remuneration

8.2.1 2022 CEO Realised Remuneration

Below we have disclosed the CEO ‘realised’ remuneration. This is a voluntary disclosure which the Board believes is simple and affords a transparent view of what the CEO’s actual take-home pay was in 2022. These outcomes are aligned with the CEO’s and CSL’s performance during 2022, as well as being aligned to CSL’s longer term performance. This information has not been prepared in accordance with the Australian accounting standards. See section 7.1 Table 10 for the Statutory Remuneration disclosure that has been prepared in accordance with the Australian accounting standards.

2022 CEO Realised Remuneration – US$

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2022 Fixed Reward - US$1,905,517 2022 STI Target - US$3,029,931 2022 LTI Target - US$7,775,435

Mr Perreault’s total ‘realised’ remuneration for 2022 was US$12,710,883 and this is a 72% decrease from the prior year. The decrease was as a result of legacy Option and Performance Right LTI plans ceasing in 2021. All LTI awards that vested in 2022 were granted under the framework introduced in 2017.

Mr Perreault’s target reward for 2023 is displayed below, along with the 2023 comparison to CEOs in our pharmaceutical/ biotechnology peer group.

2023 CEO Target Remuneration and Peer Group Comparison - US$

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2023 Total Target 15,420,773
Direct Compensation 12,506,582
12,111,053
2023 LTI Target
8,399,943
2,332,238
2023 STI Target
2,239,985
1,723,546
2023 Fixed Reward
1,866,654
Peer Group CEO - median P Perreault
----- End of picture text -----

Peer Group CEO - median

8.2.2 2022 Executive KMP Realised Remuneration

Table 13 shows the ‘realised’ remuneration of Executive KMP for the year ended 30 June 2022 in US$, providing a simple and transparent view of what Executive KMP actual take home pay was in 2022.

Table 13: Executive KMP ‘Realised’ Remuneration (Received or Available as Cash) in 2022

	2022 Total			Total	Total LTI Reward
	Fixed		LTI Vested	Reward	Received (valued
	Reward	2022 STI	in 2022	Received	at grant date)	LTI Growth in Value (due to
Executive	US$21	US$22	US$23	US$	US$24	sharepricegrowth) US$25
Period Earned	2022	2022	2018 – 2022	2018 – 2022	2018 – 2022	2018 – 2022
P Perreault	1,905,517	3,029,931	7,775,435	12,710,883	5,547,518	2,227,917
J Linton	961,840	1,149,742	2,361,849	4,473,431	2,188,300	173,549
P McKenzie	1,061,344	1,273,770	3,453,773	5,788,887	2,807,441	646,332

8.3 2022 and 2023 Executive KMP Remuneration Adjustments

CSL competes for talent in a global market and we need to attract and retain high calibre executives in a highly competitive global pharmaceutical and biotechnology industry. The unique skill set with specialised pharmaceutical and biotechnology expertise and experience that we require is critical to enable us to deliver on our strategy, promise to patients and deliver returns to our shareholders.

Table 14 sets out the changes to Executive KMP reward for 2022 (effective 1 September 2021) and 2023 (effective 1 September 2022). As noted earlier in this Report, a global pharmaceutical/biotechnology peer group is used for external benchmarking[26] . We align reward with the median of this peer group. The below rewards position our Executive KMP more competitively in the market, at or below the median for total reward. The increases also take into consideration the skills and experience of Executive KMP. For Ms Linton, the annual salary review increase is 3.25% and the remaining 0.45% is the superannuation guarantee increase that was effective 1 July 2022. In determining reward, the Board considers internal pay relativity across the full Global Leadership Group.

Table 14: Adjustments to Executive KMP Reward 2022 and 2023

Executive	Year % change in FR % change in STI $ opportunity at target % change in LTI $ opportunity at target Total Reward Adjustment % Total Reward Adjustment US$
P Perreault	2023 3.50 % 3.50 % 16.44 % 11.85 % 1,324,696
	2022 3.00 % 3.00 % 3.00 % 3.00 % 325,686
J Linton	2023 3.70 % 22.29 % 33.65 % 22.72 % 769,592
	2022 3.40 % 3.40 % 3.40 % 3.40 % 113,706
P McKenzie	2023 3.50 % 3.50 % 25.68 % 17.61 % 950,669
	2022 3.00 % 3.00 % 3.00 % 3.00 % 157,207

21 Includes base salary, retirement/superannuation benefits, and other benefits such as insurances, relocation and allowances paid in 2022. 22 Relates to STI earned in 2022 and will be paid in September 2022 (refer to section 6.2).

23 Value of LTI vested at 1 September 2021 and 1 March 2022 that became unrestricted (refer to section 6.4). The value at vest has been determined by multiplying the number of vested units by the closing share price on the date of vest. This has been converted to US$ at an average exchange rate for the 2022 financial year of 1.37359. The awards for J Linton were commencement benefits earned in 2021 given Ms Linton commenced employment with CSL in 2021.

24 The value at grant has been determined by multiplying the number of vested units by the closing share price on the date of grant. This has been converted to US$ at an average exchange rate for the 2022 financial year of 1.37359.

25 This figure shows the increase in market value of the LTI awards due to share price growth between the grant date and the vesting date. The increase in value of the awards is calculated by multiplying the number of vested and/or exercised awards by the difference between the share price of CSL shares on the grant date and the vesting date or exercise date (as applicable). This has been converted to US$ at an average exchange rate for the 2022 financial year of 1.37359.

26 Two general industry reference groups, being Australia and North America, are also used for benchmarking of certain Executive KMP roles. 72

8.4 2023 Executive KMP Target Remuneration and Peer Group Comparison

The target reward for both Ms Linton and Dr McKenzie for 2023 are displayed below, along with the 2023 comparison to their respective peers in our pharmaceutical/biotechnology peer group. The peer group comparison for Mr Perreault is detailed in section 8.1.2 above.

2023 J Linton Target Remuneration and Peer Group Comparison - US$

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2023 Total Target 5,771,830
Direct Compensation 4,157,066
3,836,683
2023 LTI Target
2,200,800
922,192
2023 STI Target
978,133
929,297
2023 Fixed Reward
978,133
Peer Group CFO - median J Linton
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2023 P McKenzie Target Remuneration and Peer Group Comparison - US$

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----- Start of picture text -----

2023 Total Target 7,902,075
Direct Compensation 6,348,000
5,792,345
2023 LTI Target
4,316,640
805,977
2023 STI Target
1,015,680
974,197
2023 Fixed Reward
1,015,680
Peer Group COO - median P McKenzie
----- End of picture text -----

9. Non-Executive Director Remuneration

9.1 NED Fee Policy

9.1 NED Fee Policy
Feature	Description
Strategic Objective	CSL’s NED fee arrangements are designed to appropriately compensate suitably
	qualified directors, with appropriate experience and expertise, for their Board
	responsibilities and contribution to Board committees. In the 2022 year, the Board
	had four Committees for which fees were payable
Maximum Aggregate Fees	The current maximum aggregate fee pool of A$4,000,000 was approved by
Approved by Shareholders	shareholders on 12 October 2016 and has applied from this date. Actual NED fees
	paid during the 2022 year (including superannuation contributions, NED Rights Plan
	sacrifice amounts and Committee fees) are within this agreed limit, and totalled
	A$2,944,126. NEDs may be reimbursed for reasonable expenses incurred by them in
	the course of discharging their duties and this reimbursement is not included within
	this limit
Remuneration Reviews	The Board in conjunction with the HRRC, reviews NED fees on an annual basis in line
	with general industry practice. Fees are set with reference to the responsibilities
	and time commitments expected of NEDs along with consideration to the level of
	fees paid to NEDs of comparable Australian companies
Independence	To ensure independence and impartiality is maintained, NEDs do not receive any
	performance related remuneration
NED Equity	The NEDs participate in the NED Rights Plan – introduced to enable NEDs to build
	up meaningful levels of equity more quickly. Under the plan, NEDs sacrifice at least
	20% of their pre-tax base fee in return for a grant of Rights, each Right entitling a
	NED to acquire one CSL share at no additional cost. The number of Rights granted is
	equivalent to the fee sacrificed divided by the prevailing market price of CSL shares
	at that time. Rights are allocated in two tranches and vesting occurs following the
	disclosure of half year and full year financial results following the grant of Rights. For
	Australian based NEDs, shares are allocated at vesting of the Rights and are then
	subject to a nominated restriction period of three to fifteen years. For overseas
	based NEDs, shares are allocated at the end of the nominated three to fifteen year
	restriction period. At the end of the nominated restriction period the NED is able to
	access their shares. No price is payable on vesting and exercise of rights. Shares are
	automatically allocated without the need for exercise by a NED. As this is a salary
	sacrifice plan, no performance conditions apply to the Rights. The shares are
	purchased on-market. Additional shares may be purchased by NEDs on-market at
	prevailing share prices in accordance with CSL’s Securities Dealing Policy
Shareholding Requirement	NEDs must hold CSL shares equal to 100% of their Board base fee within five years
	from the date of appointment to their role
Post-Employment Benefits	Superannuation contributions are made in accordance with legislation and are
	included in the reported base fee and are not additional to the base fee. NEDs are
	not entitled to anycompensation on cessation of appointment
Contracts	NEDs are appointed under a letter of appointment and are subject to ordinary
	election and rotation requirements as stipulated in the ASX Listing Rules and CSL
	Limited’s constitution

9.2 NED Fees in 2022

The following table provides details of current Board and Committee fees from 1 July 2021. As a truly global business, our NED fee structure allows us to attract and recruit appropriately skilled directors.

In 2022, after reviewing both ASX12 and ASX25 comparative Board fees, the Board determined to increase Board and Committee fees by 3% from 1 July 2022. This increase is within the maximum aggregate remuneration that may be paid to all NEDs, as agreed by shareholders at the 2016 AGM, meaning that further shareholder approval to increase these fees was not required. These increases ensure market competitive fees and allow us to attract and retain high quality NEDs.

Table 15: NED Fees 2022 and 2023

Table 15: NED Fees 2022 and 2023
	2022 Fees		2023 Fees
Board Chairman Fee		A$870,000		A$896,100
Board NED Base Fee		A$245,250		A$252,600
Committee Fees	Committee Chair	Committee	Committee Chair	Committee
		Member		Member
Audit & Risk Management	A$70,000	A$34,250	A$72,100	A$35,300
Corporate Governance & Nomination	A$30,100	A$15,100	A$31,000	A$15,550
Human Resources & Remuneration	A$60,000	A$30,100	A$61,800	A$31,000
Innovation & Development	A$58,150	A$30,100	A$59,900	A$31,000

A travel allowance of A$15,000 per annum is in place for those NEDs who reside outside of Australia and travel to and from Australia to attend Board and Committee meetings. Where no travel is undertaken in a quarter, no allowance is paid. In 2022, no allowance was paid.

9.3 Non-Executive Share Purchases

During 2022, CSL completed two on-market purchases of shares for the purposes of the NED Rights Plan. A total of 1,957 shares were purchased during the reporting period and the average price paid per share was A$286.66.

9.4 Non-Executive Director Statutory Remuneration Tables

Remuneration is reported in US$, unless otherwise stated. This is consistent with the presentation currency used by CSL.

9.4.1 Non-Executive Director Remuneration 2021 and 2022

Table 16: Statutory Remuneration Disclosure – Non-Executive Directors

Non-Executive Director	Year	Short Term Benefits Post Employment Share Based Payments Cash Salary and Fees US$27 Superannuation US$ Retirement Benefits US$ Rights US$28 Total
B McNamee - Chairman	2022	489,543 17,158 — 125,313 632,014
	2021	471,611 16,123 — 120,767 608,501
B Brook	2022	178,358 8,579 — 51,686 238,623
	2021	186,907 16,123 — 37,492 240,522
M Clark	2022	202,267 17,158 — 35,290 254,715
	2021	200,432 16,123 — 34,982 251,537
A Cuthbertson29	2022	117,973 15,015 — 33,844 166,832
	2021	— — — — —
C Hewson	2022	140,877 17,158 — 88,508 246,543
	2021	140,471 16,123 — 109,237 265,831
D Maskell30	2022	60,806 20,021 — 85,480 166,307
	2021	— — — — —
M McDonald	2022	171,831 — — 52,966 224,797
	2021	166,922 4,031 — 52,574 223,527
A Watkins31	2022	121,065 20,021 — 49,819 190,905
	2021	— — — — —

27 The A$ compensation paid and share based payments during the years ended 30 June 2021 and 30 June 2022 have been converted to US$. For the 2022 compensation, this has been converted to US$ at an average exchange rate for the 2022 financial year: A$ – 1.37359. For the 2021 compensation, this has been converted to US$ at an average exchange rate for the 2021 financial year: A$ – 1.34557. Both the amount of remuneration and any movement in comparison to prior years may be influenced by changes in the A$/US$ exchange rates. No long term or termination benefits were paid in 2022.

28 As disclosed in the section 9.1, NEDs participate in the NED Rights Plan under which NEDs are required to take at least 20% of their after-tax base fees (excluding superannuation guarantee contributions) in the form of Rights. Rights are granted upfront and are expensed over the period of grant to vest. The Fair Value per Right at the grant date of 26 August 2021 was A$304.00 for Tranche 1 (vests 21 February 2022) and A$302.62 for Tranche 2 (vests 22 August 2022). For the award made to A Cuthbertson on 4 October 2021, the Fair Value for Tranche 1 was A$292.17 and for Tranche 2 was A$290.69. 29 In 2022 A Cuthbertson was a NED for the period 2 October 2021 to 30 June 2022. 30 In 2022 D Maskell was a NED for the period 18 August 2021 to 30 June 2022.

31 In 2022 A Watkins was a NED for the period 18 August 2021 to 30 June 2022.

Non-Executive Director Year	Non-Executive Director Year	Short Term Benefits Post Employment Share Based Payments Cash Salary and Fees US$27 Superannuation US$ Retirement Benefits US$ Rights US$28 Total
Former Non-Executive Director
A Hussain32	2022 — — — — —
	2021 185,291 87 — 37,532 222,910
C O'Reilly33	2022 — — — — —
	2021 45,206 — — 29,286 74,492
P Soriot34	2022 — — — — —
	2021 76,875 103 — 13,312 90,290
TOTAL	2022 — — — — 2,120,736
	2021 1,473,715 68,713 — 435,182 1,977,610

9.4.2 Non-Executive Director Shareholdings

Details of shares held directly, indirectly or beneficially by each NED, including their related parties, is provided in Table 17. Any amounts are presented in US$. Details of Rights held directly, indirectly or beneficially by each NED, including their related parties, is provided in Table 18. Following the vesting of awards, any trading undertaken by NEDs was subject to the Group Securities Dealing Policy (outlined in section 10.6).

Table 17: Non-Executive Director Shareholdings

		Number of Shares	Value of Shares
		Acquired on	Acquired on	Number of
	Balance as at 1	Exercise of Rights	Exercise of Rights	(Shares Sold) /	Balance at 30
KMP	July 2021	during year	during year US$35	Purchased	June 2022
Non-Executive Director
B McNamee	161,681	563	117,930	118	162,362
B Brook	5,604	200	41,225	318	6,122
M Clark	3,405	160	33,550	448	4,013
A Cuthbertson36	111,693	59	11,320	—	111,752
C Hewson	764	403	84,523	74	1,241
D Maskell37	—	209	40,099	—	209
M McDonald	3,255	241	50,553	118	3,614
A Watkins38	1,715	122	23,407	118	1,955

There have been no movements in shareholdings of NEDs between 30 June 2022 and the date of this Report.

32 In 2021 A Hussain was a NED for the period 1 July 2020 to 25 June 2021.

33 In 2021 C O'Reilly was a NED for the period 1 July 2020 to 14 October 2020.

34 In 2021 P Soriot was a NED for the period 19 August 2020 to 31 January 2021.

35 The value at exercise date has been determined by the share price at the close of business on the exercise date multiplied by the number of Rights exercised during 2022. The A$ value was converted to US$ at an average rate for the year of 1.37359. 36 The opening balance for A Cuthbertson is at 2 October 2021 being the date A Cuthbertson became a NED. All equity held by A Cuthbertson in his capacity as a member of the Company's Executive KMP until 1 October 2021 is disclosed elsewhere in this Report. 37 The opening balance for D Maskell is at 18 August 2021 being the date D Maskell became a NED.

38 The opening balance for A Watkins is at 18 August 2021 being the date A Watkins became a NED.

Table 18: Non-Executive Director Right Holdings

Table 18: Non-Executive Director Right Holdings	Table 18: Non-Executive Director Right Holdings
KMP Security Balance at 1 July 2021 Number Granted39 Face Value of Rights Granted US$40 Fair Value of Rights Granted US$41 Number Exercised42 Value of Rights Exercised US$43 Number Lapsed Balance at 30 June 2022 Number Vested During Year		Balance at 30 June 2022
		Vested44 Unvested45
Non-Executive Director
B McNamee	Right 278 569 127,628 125,644 563 117,930 — 284 563	— 284
B Brook	Right 80 240 53,833 52,995 200 41,225 — 120 200	— 120
M Clark	Right 80 160 35,888 35,331 160 33,550 — 80 160	— 80
A Cuthbertson 46	Right — 179 37,443 37,945 59 11,320 — 120 59	— 120
	PSU 4,480 — — — — — — 4,480 —	— 4,480
C Hewson	Right 202 401 89,945 88,548 403 84,523 — 200 403	— 200
D Maskell47	Right — 417 93,534 92,081 209 40,099 — 208 209	— 208
M McDonald	Right 121 240 53,833 52,995 241 50,553 — 120 241	— 120
A Watkins48	Right — 243 54,505 53,659 122 23,407 — 121 122	— 121

39 The number of Rights granted is determined by dividing the NEDs elected percentage of pre-tax base fee (minimum 20%) by the five day volume weighted average price (VWAP) at which CSL shares were traded on the ASX ending on (and including) the last ASX trading day prior to the date of grant of the Rights being 25 August 2021 of A$305.37. The Rights were granted on 26 August 2021 in two tranches. Tranche one had a vesting date of 21 February 2022 and tranche two vests 22 August 2022. For the grant to A Cuthbertson on 4 October 2021, the VWAP was A$293.32.

40 The value at grant date has been determined by the share price at the close of business on the grant date of 26 August 2021 being A$308.10 multiplied by the number of Rights granted during 2022. For the grant to A Cuthbertson on 4 October 2021, the closing share price was A$287.33. The A$ value was converted to US$ at an average exchange rate for the year of 1.37359. The Rights have an expiry date fifteen years from the start of the financial year in which the Rights were granted.

41 The value of Rights is calculated based on an assessment of the fair market value of the instruments in accordance with the accounting standards (refer to Note 18 in the Financial Statements). The fair value of each Right granted on 26 August 2021 was Tranche 1: A$304.00 and Tranche 2: A$302.62 multiplied by the number of Rights granted during 2022. For the grant to A Cuthbertson, the fair value for Tranche 1 was A$292.17 and Tranche 2 was A$290.69.

42 Vesting and exercise occurred in relation to tranche 2 of the 2021 grant and tranche 1 of the 2022 grant. All Rights eligible vested at 100% during the year. No Rights eligible to vest were lapsed.

43 The value at exercise date has been determined by the share price at the close of business on the exercise date multiplied by the number of Rights exercised during 2022. The A$ value was converted to US$ at an average exchange rate for the year of 1.37359. Australian based NEDs have Rights exercised at the vesting date and a holding lock is placed on the shares for a period of three to fifteen years as elected by the NED. 44 Vested Rights are exercisable to the NED at the end of the nominated restriction period. All vested Rights are currently unexercisable until the end of the nominated restriction period.

45 Unvested Rights represent Tranche 2 of the 2022 grant that will vest on 22 August 2022, following the release of full year financial results.

46 The opening balance for A Cuthbertson is at 2 October 2021 being the date A Cuthbertson became a NED. All equity held by A Cuthbertson in his capacity as a member of the Company's Executive KMP until 1 October 2021 is disclosed elsewhere in this Report.

47 The opening balance for D Maskell is at 18 August 2021 being the date D Maskell became a NED.

48 The opening balance for A Watkins is at 18 August 2021 being the date A Watkins became a NED. 77

10. Remuneration Governance

The following diagram illustrates CSL’s remuneration governance framework.

CSL Board:

The Board is responsible for the oversight and strategic direction of CSL. It monitors operational and financial performance, human resources policies and practices, and approves the company's budgets and business plans. It is also responsible for overseeing CSL's risk management, financial reporting and compliance framework.

The Board reviews, makes comment on and, as appropriate, approves remuneration recommendations from the HRRC. The Board approves the remuneration and remuneration outcomes for the CEO and Non-Executive Directors and approves the policies and processes that govern both.

HRRC:

The HRRC has oversight of all aspects of remuneration at CSL. The Board has delegated responsibility to the HRRC for reviewing and making recommendations to the Board with regard to:

Executive remuneration design;
Approval of awards to the CEO;

ARMC:

The ARMC assists the Board in the governance of CSL’s financial reporting and disclosures, risk identification and management, and compliance, and oversees and monitors ESG performance.

The ARMC advises the HRRC on any material risk management and financial matters that may impact remuneration outcomes.

Senior executive succession planning;
The design and implementation of any incentive plan (including equity based arrangements);
The remuneration and other benefits applicable to NEDs; and
The CSL diversity policy and measurable objectives for achieving gender diversity.

The HRRC is able to approve the remuneration of Executive KMP (excluding the CEO).

Members

Dr Megan Clark AC (Chair), Ms Carolyn Hewson AO, Ms Marie McDonald and Ms Alison Watkins AM.

External Remuneration Advisers:

The Board and the HRRC may seek and consider advice directly from external advisers, who are independent of management.

In 2022 the HRRC engaged the services of Aon Consulting in the U.S., and EY in Australia. Under engagement and communication protocols adopted by CSL, the market data and other advice were provided directly to the HRRC by both Aon Consulting and EY. Neither Aon Consulting nor EY provided Remuneration Recommendations during the 2022 financial year.

Joint HRRC and ARMC meetings:

The Committees meet jointly at least annually to review and consider relevant risk management matters in the determination of the Executive KMP remuneration outcomes.

10.1 HRRC Activities

During 2022, the HRRC met formally on seven occasions. Activities undertaken include:

Review of the executive remuneration framework;
Review and consideration of investor feedback received across the year;
Appointment of external remuneration advisers;
Review of senior executive appointments and remuneration arrangements;
Review of STI and LTI arrangements, and reward outcomes for senior executives;
Review of the CSL diversity objectives and report, and gender pay review and progress against diversity objectives;
Review of talent and succession planning for senior executives;
Review of long term remuneration strategy and global trends in remuneration;
Review of NED remuneration; and
Review of the HRRC Charter and HRRC performance.

Full responsibilities of the HRRC are outlined in its Charter (reviewed annually). The Charter is available at http://www.csl.com.au/about/ governance.htm

10.2 Remuneration Determination

The Board has discretion across each element of Executive KMP reward and considers business performance, individual performance and shareholder experience before setting and approving reward outcomes.

Remuneration Recommendations – Reviewed on an annual basis, the CEO makes a recommendation to the HRRC for Executive KMP, with the HRRC recommending to the Board for the CEO, any change to FR and STI and LTI targets for the year ahead. Recommendations take into consideration market conditions, position in market within the global pharmaceutical/biotechnology peer group, individual performance, role responsibilities and internal relativity. Remuneration is reviewed in the context of Total Reward. There is a higher proportion of Total Reward in the form of performance related variable pay.

STI Outcomes – A formal review of Executive KMP progress against KPIs is conducted twice annually by the CEO and annually by the Board for the CEO. Regular performance conversations are held during the year. Following the full year performance review, the CEO makes recommendations in respect of Executive KMP to the HRRC. The HRRC and the Board assess individual performance against KPIs at the end of the financial year, and approve the actual STI payments to be made. The Board determines the outcomes for the

CEO, based on recommendations from the HRRC, who are informed by the Chairs of the Board and HRRC. The Board believes this is the most appropriate method of measurement.

LTI Outcomes – The HRRC assesses performance against the hurdle measures set at grant by the Board. Following this, the HRRC undertakes a review to ensure the remuneration outcomes are aligned with overall business performance and the shareholder experience and then submits outcomes to the Board for approval. The Board believes this is the most appropriate method of measurement.

Board Discretion – Prior to approving CEO remuneration outcomes and before finalising all other Executive KMP outcomes, the Board holistically assesses the outcomes and considers whether there are any circumstances warranting application of the Malus and Clawback Policy. It also considers the ‘Leading and Managing’ modifier and ensures that the interaction of remuneration outcomes is in alignment with risk management outcomes for the year and that any material risk issues and behaviours and/or compliance breaches are addressed. The Board’s assessment is informed by the review undertaken by the HRRC in conjunction with the ARMC. The Board has discretion to determine final vesting outcomes to ensure outcomes are in line with CSL performance, market reported financial outcomes and shareholder outcomes. Discretion may be exercised to either increase or reduce vesting outcomes, which includes reducing to zero.

In 2022, the Board reviewed the quality of earnings, impact of COVID-19 and risk management outcomes across the year. As the Vifor acquisition was not contemplated at the time of setting the targets at the start of the financial year, the Board used its discretion to adjust the outcomes of both NPAT and CFO associated with the Vifor acquisition net costs. The CFO outcome was also adjusted to remove the impact of the favourable cash inflow resulting from the Treasury hedging activity associated with the Vifor acquisition.

New Hires and Internal Promotions – The Remuneration Framework as set out in section 3.2 applies to the remuneration arrangements for any newly hired or promoted Executive KMP, ensuring a market competitive Total Reward offering. In the case of external hires, the HRRC and Board may determine that it is appropriate for a commencement benefit to be offered. Commencement benefits in the form of cash and/or equity can be made to compensate for remuneration being forfeited from a former employer. For any foregone equity awards, CSL equity will typically be used as compensation. Awards may be discounted to take into consideration any performance 79

conditions on the award at the former employer and the HRRC will determine the appropriate service and performance conditions on the CSL award within the CSL framework. For internal promotions, the HRRC may determine that an award of equity should

be made to ensure an appropriate Total Reward package. This is typically done as hurdled equity under the LTI framework described in section 3.2.5.

10.3 Contractual Provisions for Executive KMP

Executive KMP are employed on individual service contracts that outline the terms of their employment, which include:

which include:
Duration of Contract	Notice Period Employee	Notice Period CSL*	Termination Payment
No fixed term	Six months	Six months	12 months

*CSL may also terminate at any time without notice for serious misconduct and/or breach of contract

10.4 Other Transactions

No loans were made, guaranteed or secured, directly or indirectly by CSL or any of its subsidiaries, to any Executive KMP or their related parties during 2022.

No loans were made to NEDs during 2022. To the extent that there were transactions between the Company and an organisation with which a NED may be connected or associated, those transactions were all on normal commercial arms' length terms, immaterial, and the relevant NED had no involvement in any procurement or other Board decision-making related to the transaction.

10.5 Malus and Clawback Policy

CSL operates a Malus and Clawback Policy. ‘Malus’ means adjusting or cancelling all or part of an individual’s variable reward as a consequence of a materially adverse development occurring prior to payment (in the case of cash incentives) and/or prior to vesting (in the case of equity incentives). 'Clawback’ means seeking recovery of a benefit paid to take into account a materially adverse development that only comes to light after payment, including shares delivered post vesting.

The Board, in its discretion, may apply the policy to any incentive provided to a senior executive, including a former senior executive, upon the occurrence (or the discovery of the occurrence) of any of the following events or conduct:

material misstatement, omission or error in the financial statements of a Group company or the CSL Group leading to a senior executive receiving a benefit greater than the amount that would have been received had such misstatement, omission or error not occurred,
fraud or dishonesty to CSL or any Group company,
wilful engagement in conduct which is, or might reasonably be expected to be,

injurious to CSL or any Group company, monetarily or otherwise, including, but not limited to, its reputation or standing in its industry,

intentional act that is materially adverse to the best interests of CSL or any Group company,
violation of any material law or regulation,
adverse risk management outcomes, and/or
material violation of CSL’s Code of Conduct or any other policy governing the conduct of employees of CSL or any Group company or any agreement or covenant entered into between a senior executive and CSL or any Group company.

In 2022, following a joint review of reward outcomes by both the HRRC and the ARMC, there was no application of the policy.

10.6 Securities Dealing

The CSL Securities Dealing Policy prohibits employees from using price protection arrangements (e.g. hedging) in respect of CSL securities, or allowing them to be used. The Policy also provides that no CSL securities can be used in connection with a margin loan. Upon vesting of an award, an employee may only deal in their CSL securities in accordance with the Policy. A breach of the Policy may result in disciplinary action. A copy of the Policy is available at http://www.csl.com.au/ about/governance.htm.

10.7 Minimum Shareholding Guideline

To be met within a target of the first five years of appointment, or within five years for current incumbents, and to be held whilst in the role at CSL, the following levels of vested equity must be held:

CEO: Three times base salary;
Executive KMP: One times base salary; and
NEDs: One times Board base fee.

As at 30 June 2022, all KMP hold, or are on track to hold, the minimum shareholding requirement within the relevant time period.

11. Additional Employee Equity Programs and Legacy Plan Information

In addition to the Executive Performance and Alignment Plan LTI program described earlier in this Report, CSL operates two additional employee equity programs – the Global Employee Share Plan and the Retain and Grow Plan. An overview of those programs is provided below.

During 2022, CSL completed two on-market purchases of shares for the purposes of employee share plan awards described below. A total of 126,056 shares were purchased during the reporting period and the average price paid per share was A$267.60.

11.1 Global Employee Share Plan

CSL’s Global Employee Share Plan (GESP) provides all employees the opportunity to share in the ownership of our company and share in our future.

Operating across two six month contribution periods, an employee can elect to make post tax salary contributions between A$365 and A$12,000 per six month period. The employee then receives shares at a 15% discount to the applicable market rate over the five day period up to and including the first and last ASX trading days of the six month period, whichever is the lower. Shares are then held in restriction for a period of one or three years as determined upfront by the employee. The shares may be issued or purchased on market.

To participate in GESP an employee must have at least six months service at the start of the contribution period. Participation is open to permanent full or part time and fixed term contract employees and excludes Executive Directors.

11.2 Retain and Grow Plan

The CSL Group Retain and Grow Plan (RGP) LTI program is designed to attract, motivate and retain key talent across the organisation. RGP provides eligible employees with longer-term share ownership in CSL, enabling them to share in the company’s success and any capital growth.

The RGP recognises those individuals in management roles (Manager to Senior Vice President) across the CSL Group. Awards under the RGP are not guaranteed and the CSL Board will review participation on an annual basis.

Key plan elements are as follows

A conditional ‘right’ to a CSL share (i.e. full value instrument) or at the Board’s discretion, a cash equivalent payment. No price is payable by the participant on grant or vesting of rights. Shares are automatically allocated (or cash automatically paid) without the need for exercise by a participant;
Individual performance hurdle – must not fail to meet performance expectations;
33% of RSUs will vest on the first and second anniversaries of the Issue Date, with the remaining 34% vesting on the third anniversary;
There is no retesting of awards;
On cessation of employment a ‘qualified leaver’ (such as retirement or redundancy) will retain a pro-rated number of RSUs based on time elapsed since grant date, subject to original terms and conditions. If a participant is not a ‘qualified leaver’, all unvested awards will be forfeited unless the Board determines otherwise;
In the event of a change of control, the Board, in its absolute discretion, may determine that some or all of the awards vest having regard to the performance of the participant during the vesting period to the date of the change of control event. Vesting may occur at the date of the change of control event or an earlier vesting date as determined by the Board; and
No dividends or dividend equivalents are paid on unvested awards. Participants are only eligible for dividends once shares have been allocated following vesting of any RSUs. RSUs do not carry any voting rights prior to vesting and allocation of shares.

Our Senior Vice President and Vice President employees participate in both the Executive Performance and Alignment PSU (described in section 3.2.5) and RGP LTI Plans with a higher portion of awards aligned to the executive plan.

The RGP is also used for commencement benefits, retention and recognition awards at all levels of the organisation. The difference to the annual program is the vesting schedule, which is reviewed and determined on a case by case basis.

The security granted is a RSU;
LTI opportunity set as % of local salary (converted to A$ at grant);
Number of RSUs determined using face value (five day weighted average share price);

11.3 Key Characteristics of Prior Financial Year Performance Share Unit Grants

The following table provides information on the key characteristics of the LTI programs on foot during the 2022 reporting period. The 2018 (granted October 2017), 2019 (granted September 2018), 2020 (granted September 2019) and 2021 (granted September 2020) PSU LTI awards have the same key characteristics as the 2021 award disclosed in section 3.2.5 with the exception of the hurdle, performance period, performance targets and vesting dates as outlined below.

Table 19: Key Characteristics of Prior Financial Year PSU Grants

		Performance	Performance	Performance
Grant Date	Tranche	Measure	Period	Target	Vesting Date
1 Oct 2017 1 Sep2018	4 3	ROIC	1 July 2017 - 30 June 2024	Threshold - 24% Target 27%	1 September 2021
				Threshold - 22%
1 Sept 2019	2			Target 25%
				Threshold - 20%
1 Sep2020	1			Target 23%

CSL ASX Full Year Information

2022 Key Dates

17 August Annual results and final dividend announcement 6 September Shares trade ex-dividend 7 September Record date for final dividend 5 October Final dividend paid 12 October Annual General Meeting 31 December Half Year ends

2023 Key Dates

15 February Half Year results and interim dividend announcement 9 March Shares trade ex-dividend 10 March Record date for interim dividend 5 April Interim dividend paid 30 June Full Year ends 16 August Annual results and final dividend announcement 11 September Shares trade ex-dividend 12 September Record date for final dividend 4 October Final dividend paid 11 October Annual General Meeting 31 December Half Year ends

2022 Annual General Meeting

The 2022 Annual General Meeting (AGM) of CSL Limited (ABN 99 051 588 348) will be held on Wednesday, 12 October 2022 at 10am (Melbourne time) at the Clarendon Auditorium, Melbourne Convention and Exhibition Centre, South Wharf, Melbourne 3000. Further information on CSL’s AGM will be provided to shareholders when the Notice of Meeting is released.

In accordance with CSL’s Constitution, the closing date for director candidate nominations is Wednesday 31 August 2022, being at least 30 business days before the Annual General Meeting.

Find out more on CSL.com.

CSL Limited

ABN: 99 051 588 348

Financial Statements 30 June 2022

Consolidated Statement of Comprehensive Income

For the Year Ended 30 June 2022

Consolidated Statement of Comprehensive Income For the Year Ended 30 June 2022
Notes	Consolidated Entity
	2022 2021 US$m US$m
Sales and service revenue Influenza pandemic facility reservation fees Royalties and license revenue Other income	10,136.3 9,979.5 162.2 160.1 194.6 125.7 68.8 44.7
Total operating revenue 3 Cost of sales	10,561.9 10,310.0 (4,829.6) (4,466.7)
Gross profit Research and development expenses 7 Selling and marketing expenses General and administration expenses	5,732.3 5,843.3 (1,156.2) (1,001.4) (960.7) (980.2) (688.0) (731.7)
Total expenses	(2,804.9) (2,713.3)
Operating profit Finance costs 3 Finance income	2,927.4 3,130.0 (165.2) (170.8) 17.4 3.9
Profit before income tax expense Income tax expense 4	2,779.6 2,963.1 (524.9) (588.1)
Net profit for the year	2,254.7 2,375.0
Other comprehensive income Items that may be reclassified subsequently to profit or loss Hedging transactions - Changes in fair value 12 - Realised in profit and loss 12 Exchange differences on translation of foreign operations, net of hedges on foreign investments 12 Items that will not be reclassified subsequently to profit or loss Actuarial gains on defined benefit plans, net of tax 19 Changes in fair value on equity securities measured through other comprehensive income, net of tax 12	134.7 — (1.0) — (286.9) 198.9 34.7 83.4 (6.6) —
Total other comprehensive (losses)/income	(125.1) 282.3
Total comprehensive income for the year	2,129.6 2,657.3
Earnings per share (based on net profit for the year)	US$ US$
Basic earnings per share 10	4.81 5.22
Diluted earnings per share 10	4.80 5.21

The consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.

Consolidated Balance Sheet

As at 30 June 2022

Consolidated Balance Sheet As at 30 June 2022
Notes	Consolidated Entity
	2022 2021 US$m US$m
CURRENT ASSETS Cash and cash equivalents 14 Receivables and contract assets 15 Inventories 5 Current tax assets Other financial assets 11	10,436.4 1,808.8 1,657.2 1,711.2 4,333.0 3,780.6 29.9 84.3 4.2 4.8
Total Current Assets	16,460.7 7,389.7
NON-CURRENT ASSETS Property, plant and equipment 9 Intangible assets 8 Right-of-use assets 9 Deferred tax assets 4 Other receivables 15 Other financial assets 11 Retirement benefit assets 18	7,016.6 6,434.3 2,638.1 2,669.7 1,292.0 1,101.7 517.5 529.5 12.8 6.6 402.9 21.5 5.4 3.9
Total Non-Current Assets	11,885.3 10,767.2
TOTAL ASSETS	28,346.0 18,156.9
CURRENT LIABILITIES Trade and other payables 15 Interest-bearing liabilities and borrowings 11 Current tax liabilities Provisions 16	2,301.2 2,089.4 4,494.0 473.8 131.5 313.0 181.5 227.4
Total Current Liabilities	7,108.2 3,103.6
NON-CURRENT LIABILITIES Interest-bearing liabilities and borrowings 11 Retirement benefit liabilities 18 Deferred tax liabilities 4 Provisions 16 Other non-current liabilities 15	5,163.8 5,333.1 189.0 286.4 670.1 459.4 101.7 107.8 535.7 485.3
Total Non-Current Liabilities	6,660.3 6,672.0
TOTAL LIABILITIES	13,768.5 9,775.6
NET ASSETS	14,577.5 8,381.3
EQUITY Contributed equity 12 Reserves 12 Retained earnings 19	483.8 (4,504.6) 590.3 633.2 13,503.4 12,252.7
TOTAL EQUITY	14,577.5 8,381.3

The consolidated balance sheet should be read in conjunction with the accompanying notes.

Consolidated Statement of Changes in Equity

For the Year Ended 30 June 2022

	Contributed Equity US$m	Other reserves Retained earnings Total US$m US$m US$m
	2022 2021	2022 2021 2022 2021 2022 2021
As at the beginning of the year Profit for the year Other comprehensive (losses)/income	(4,504.6)(4,561.0) 633.2 336.312,252.710,752.3 8,381.3 6,527.6 — — — — 2,254.7 2,375.0 2,254.7 2,375.0 — — (159.8) 198.9 34.7 83.4 (125.1) 282.3
Total comprehensive (loss)/income for the year Transactions with owners in their capacity as owners Share-based payments Dividends Share issues	— — — — — — 4,988.4 56.4	(159.8) 198.9 2,289.4 2,458.4 2,129.6 2,657.3 116.9 98.0 — — 116.9 98.0 — —(1,038.7) (958.0)(1,038.7) (958.0) — — — — 4,988.4 56.4
As at the end of theyear	483.8(4,504.6) 590.3 633.213,503.412,252.714,577.5 8,381.3

The consolidated statement of changes in equity should be read in conjunction with the accompanying notes.

Consolidated Statement of Cash Flows

For the Year Ended 30 June 2022

Consolidated Statement of Cash Flows For the Year Ended 30 June 2022
Notes	Consolidated Entity
	2022 2021 US$m US$m
Cash Flows from Operating Activities Profit before income tax expense Adjustments for: Depreciation, amortisation and impairment Inventory provisions Share-based payment expense Provision for expected credit losses Finance costs Loss/(gain) on disposal of property, plant and equipment Contingent consideration liabilities reversal 1 Unrealised foreign exchanges (gains)/losses Changes in operating assets and liabilities: (Increase)/decrease in receivables and contract assets Increase in inventories Increase in trade and other payables (Decrease)/increase in provisions and other liabilities Income tax paid Finance costs paid Proceeds from settlement of treasury lock 3	2,779.6 2,963.1 668.3 589.6 223.8 208.3 116.8 91.8 3.4 3.5 165.2 170.8 1.3 (0.3) 62.5 — (60.2) 70.4 (44.6) 36.5 (902.3) (367.7) 212.3 454.9 (102.7) 56.4 (457.1) (494.5) (172.3) (160.9) 134.7 —
Net cash inflow from operating activities	2,628.7 3,621.9
Cash flows from Investing Activities Payments for property, plant and equipment Payments for intangible assets Payments for equity securities 2 Payments for other investing activities	(1,078.8) (1,196.3) (168.9) (470.8) (387.7) — (0.7) (6.1)
Net cash outflow from investing activities	(1,636.1) (1,673.2)
Cash flows from Financing Activities Proceeds from issue of shares Dividends paid 10 Proceeds from borrowings 11 Repayment of borrowings 11 Principal payments of lease liabilities Other financing activities	4,988.4 56.4 (1,038.7) (958.0) 4,092.7 38.7 (316.4) (470.9) (52.6) (64.5) 2.5 (3.5)
Net cash inflow/(outflow) from financing activities	7,675.9 (1,401.8)
Net increase in cash and cash equivalents	8,668.5 546.9
Cash and cash equivalents at the beginning of the financial year Exchange rate variations on foreign cash and cash equivalent balances	1,730.1 1,151.3 (64.2) 31.9
Cash and cash equivalents at the end of the year	10,334.4 1,730.1
Reconciliation of cash and cash equivalents in the statement of cash flows: Cash and cash equivalents Bank overdrafts	10,436.4 1,808.8 (102.0) (78.7)
Cash and cash equivalents at the end of the year	10,334.4 1,730.1

The consolidated statement of cash flows should be read in conjunction with the accompanying notes.

Notes to the Financial Statements

For the Year Ended 30 June 2022

Contents
About this Report	5
Notes to the financial statements:	6
Our Current Performance	7
Note 1: Segment Information	7
Note 2: Business Acquisition	8
Note 3: Revenue and Expenses	8
Note 4: Tax	10
Note 5: Inventories	11
Note 6: People Costs	12
Our Future	14
Note 7: Research and Development	14
Note 8: Intangible Assets	14
Note 9: Property, Plant and Equipment	16
Returns, Risk & Capital Management	18
Note 10: Shareholder Returns	18
Note 11: Financial Risk Management	19
Note 12: Equity and Reserves	25
Note 13: Commitments and Contingencies	26
Efficiency of Operation	27
Note 14: Cash and Cash Equivalents	27
Note 15: Receivables, Contract Assets and	27
bl Note 16: Provisions	29
Other Notes	30
Note 17: Related Party Transactions	30
Note 18: Detailed Information - People Costs	30
Note 19: Detailed Information - Shareholder	33
Note 20: Auditor Remuneration	34
Note 21: Deed of Cross Guarantee	35
Note 22: Parent Entity Information	37
Note 23: Subsequent Events	37
Note 24: Amendments to Accounting	37
Standards and Interpretations

About this Report

Notes to the financial statements:

Corporate information

CSL Limited ("CSL") is a for-profit company incorporated and domiciled in Australia and limited by shares publicly traded on the Australian Securities Exchange. This financial report covers the financial statements for the consolidated entity consisting of CSL and its subsidiaries (together referred to as the Group). The financial report was authorised for issue in accordance with a resolution of directors on 16 August 2022.

A description of the nature of the Group’s operations and its principal activities is included in the directors’ report.

a. Basis of preparation

This general purpose financial report has been prepared in accordance with Australian Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards Board, International Financial Reporting Standards (IFRS) and the Corporations Act 2001 . It presents information on a historical cost basis, except for certain financial instruments, which have been measured at fair value. Amounts have been rounded off to the nearest hundred thousand dollars.

The report is presented in US dollars, because this currency is the pharmaceutical industry standard currency for reporting purposes. It is the predominant currency of the Group’s worldwide sales and operating expenses.

b. Principles of consolidation

The consolidated financial statements comprise the financial statements of CSL and its subsidiaries as at 30 June 2022. CSL has control of its subsidiaries when it is exposed to, and has the rights to, variable returns from its involvement with those entities and when it has the ability to affect those returns. A list of significant controlled entities (subsidiaries) at year end is contained in Note 17.

The financial results of the subsidiaries are prepared using consistent accounting policies and for the same reporting period as the parent company.

In preparing the consolidated financial statements, all intercompany balances and transactions have been eliminated in full. The Group has formed a trust to administer the Group’s employee share plan. This trust is consolidated as it is controlled by the Group.

Notes to the Financial Statements

c. Foreign currency

While the presentation currency of the Group is US dollars, entities in the Group may have other functional currencies, reflecting the currency of the primary economic environment in which the relevant entity operates. The parent entity, CSL Limited, has a functional currency of US dollars.

If an entity in the Group has undertaken transactions in foreign currency, these transactions are translated into that entity’s functional currency using the exchange rates prevailing at the dates of the transactions. Where the functional currency of a subsidiary is not US dollars, the subsidiary’s assets and liabilities are translated on consolidation to US dollars using the exchange rates prevailing at the reporting date, and its profit and loss is translated at average exchange rates. All resulting exchange differences are recognised in other comprehensive income and in the foreign currency translation reserve in equity.

d. Other accounting policies

Significant accounting policies that summarise the measurement basis used and are relevant to an understanding of the financial statements are provided throughout the notes to the financial statements.

e. Key judgements and estimates

In the process of applying the Group’s accounting policies, a number of judgements and estimates of future events are required. Material judgements and estimates are found in the following notes:

f. The notes to the financial statements

The notes to these financial statements have been organised into logical groupings to help users find and understand the information they need. Where possible, related information has been provided in the same place. More detailed information (for example, valuation methodologies and certain reconciliations) has been placed at the rear of the document and cross-referenced where necessary. CSL has also reviewed the notes for materiality and relevance and provided additional information where it is helpful to an understanding of the Group’s performance.

g. Significant changes in current reporting period

The consolidated financial statements have been prepared using the same accounting policies as used in the annual financial statements for the year ended 30 June 2021.

There were no significant changes in accounting policies during the year ended 30 June 2022, nor did the introduction of new accounting standards lead to any change in measurement or disclosure in these financial statements.

The Group has not adopted any accounting standards that are issued but not yet effective. Significant accounting policies that summarise the measurement basis used and are relevant to an understanding of the financial statements are provided in the annual financial report.

Note	3:	Revenue and Expenses	Page 8
Note	4:	Tax	Page 10
Note	5:	Inventories	Page 11
Note	6:	People Costs	Page 12
Note	8:	Intangible Assets	Page 14
Note	11:	Financial Risk Management	Page 19
Note	15:	Receivables, Contract Assets	Page 27
		and Payables

CSL also has a practice of periodically conducting climate change risk assessments. This year we concluded an enterprise-wide risk assessment of our manufacturing facilities, CSL Plasma operations and key warehouse and third-party logistics infrastructure, some directly owned by CSL.

The Group has assessed the impact of climate risk on its financial reporting. The impact assessment was primarily focused on the valuation and useful lives of intangible assets and the identification and valuation of provisions and contingent liabilities, as these are judged to be the key areas that could be impacted by the current reasonably foreseeable climate risks. No material accounting impacts or changes to judgements or other required disclosures were noted. While the Group’s assessment did not have a material impact for the year ended 30 June 2022, this may change in future periods as the Group regularly updates its assessment of the impact of the lower carbon economy.

Notes to the Financial Statements Our Current Performance

Note 1: Segment Information

The Group’s segments represent strategic business units that offer different products and operate in different industries and markets. They are consistent with the way the CEO (who is the chief operating decision-maker) monitors and assesses business performance in order to make decisions about resource allocation. Performance assessment is based on EBIT (earnings before interest and tax) and EBITDA (earnings before interest, tax, depreciation, amortisation and impairment). These measures are different from the profit or loss reported in the consolidated financial statements which is shown after net interest and tax expense. This is because decisions that affect net interest expense and tax expense are made at the Group level. It is not considered appropriate to measure segment performance at the net profit after tax level.

The Group’s operating segments are:

CSL Behring – manufactures, markets, and distributes plasma therapies (plasma products and recombinants), conducts early-stage research on plasma and non-plasma therapies, excluding influenza, receives licence and royalty income from the commercialisation of intellectual property and undertakes the administrative and corporate function required to support the Group.
CSL Seqirus – manufactures and distributes non-plasma biotherapeutic products and develops influenza related products.

		CSL Behring CSL Seqirus Consolidated Entity
		US$m US$m US$m
		2022 2021 2022 2021 2022 2021
Sales and service revenue Influenza pandemic facility reservation fees Royalty and license revenue Other income		8,359.6 8,427.8 1,776.7 1,551.7 10,136.3 9,979.5 — — 162.2 160.1 162.2 160.1 194.6 125.7 — — 194.6 125.7 44.2 20.3 24.6 24.4 68.8 44.7
Total segment revenue		8,598.4 8,573.8 1,963.5 1,736.2 10,561.9 10,310.0
Segment gross profit Segment gross profit %		4,579.9 4,847.6 1,152.4 995.7 5,732.3 5,843.3 53.3% 56.5% 58.7% 57.3% 54.3% 56.7%
Segment EBIT		2,192.7 2,646.9 734.7 483.1 2,927.4 3,130.0
Consolidated operating profit		2,927.4 3,130.0
Finance costs Finance income		(165.2) (170.8) 17.4 3.9
Consolidated profit before tax Income tax expense		2,779.6 2,963.1 (524.9) (588.1)
Consolidated net profit after tax		2,254.7 2,375.0
Amortisation Depreciation Impairment1		67.4 66.6 29.4 29.3 96.8 95.9 375.9 343.4 69.8 56.0 445.7 399.4 125.8 93.3 — 1.0 125.8 94.3
Segment EBITDA		2,761.8 3,150.2 833.9 569.4 3,595.7 3,719.6
	CSL Behring CSL Seqirus Intersegment Elimination Consolidated Entity
	US$m US$m US$m US$m
	2022 2021 2022 2021 2022 2021 2022 2021
Segment assets Segment liabilities	25,881.6 15,907.3 3,041.3 2,573.3 (576.9) (323.7) 28,346.0 18,156.9 12,665.1 8,881.2 1,618.1 1,156.3 (514.7) (261.9) 13,768.5 9,775.6
Other segment information - capital expenditure
Payments for property, plant and equipment ("PPE") 921.3 1,048.7 157.5 147.6 — — 1,078.8 1,196.3 Payments for intangibles 161.6 463.1 7.3 7.7 — — 168.9 470.8
Total capital expenditure 1,082.9 1,511.8 164.8 155.3 — — 1,247.7 1,667.1

Geographical areas of operation

The Group operates predominantly in Australia, the USA, Germany, the United Kingdom, Switzerland and China. The rest of the Group’s operations are spread across many countries and are collectively disclosed as ‘Rest of World’.

1 During the year ended 30 June 2022, the Group impaired certain intellectual property assets associated with the Calimmune acquisition ($112.6m). The Group also derecognised the related contingent consideration liabilities ($62.5m) for amounts payable to former shareholders of Calimmune as well as the reversal of the related deferred tax liabilities ($25.3m). The net impact to the profit or loss from all related adjustments was a loss of $24.8m.

Notes to the Financial Statements

Note 1: Segment Information continued

Geographic areas	Australia United States Germany UK Switzerland China Rest of World Total US$m US$m US$m US$m US$m US$m US$m US$m
	2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
External operating revenue	1,022.1 859.15,123.54,983.5 781.2 854.1596.1579.5 281.5 307.0 744.6 650.92,012.92,075.910,561.910,310.0
PPE, right-of-use assets and intangible assets	1,420.51,435.43,950.33,543.81,232.71,087.7 331.1 417.33,099.32,792.9 481.6 483.9 431.2 444.710,946.710,205.7

Note 2: Business Acquisition

Acquisition of Vifor Pharma AG ("Vifor")

On 13 December 2021, the Group entered into a definitive agreement to launch an all-cash public tender offer to acquire 100% of Vifor, which was subject to regulatory approvals. Vifor is a Swiss based, global specialty pharmaceutical company with a world-leading iron replacement platform for treatment of diseases such as iron deficiency anaemia. Through its extensive dialysis portfolio, Vifor has built a strong presence in renal diseases which continues to benefit from the introduction of novel therapies impacting disease progression. A cornerstone of Vifor’s growth strategy has been its strategic partnerships, which have allowed the company to both broaden its portfolio and provide patients access to the treatments they need.

Following closing of the tender offer, the Group commenced buying Vifor's shares on-market. As at 30 June 2022, the Group had purchased 3.3% of Vifor's shares for $387.7m with a fair value of $381.1m, recorded as non-current other financial assets in the balance sheet. These securities are carried at fair value through other comprehensive income ("OCI") as discussed in Note 11(e) and Note 12(b).

The Group has secured funding for the acquisition of Vifor as follows:

Completion of a AUD$6,300m ($4,500m) Equity Placement in December 2021 and a AUD$750m ($537m) Share Purchase Plan in February 2022 (Note 12(b));
Issuance of $4,000m in 144A senior unsecured notes ranging from 5 – 40 years, in April 2022 (Note 11(d));
$2,500m in bilateral credit facilities secured in May 2022 and drawn down subsequent to 30 June 2022 in August 2022 (Note 11(d)); and
Cash and other bank facilities.

During the year ended 30 June 2022, the Group has incurred $27.7m in net finance costs (pre tax) associated with acquisition financing. The Group has also incurred $40.0m of acquisition and integration planning costs (pre tax) in connection with the transaction that are recognised as general and administrative expenses.

Subsequent to 30 June 2022, the Group has received all necessary regulatory clearances and completed the acquisition of Vifor on 9 August 2022. The Group has paid $11,441.9m for 98% of Vifor shares (includes Vifor's shares acquired as at 30 June 2022) and will proceed with cancellation of the remaining publicly held Vifor shares, in accordance with Swiss takeover rules. The Group will also apply for the delisting of Vifor shares on the SIX. The total consideration for 100% of Vifor shares is expected to be approximately $11,648.1m.

The net book value of the group of assets acquired and the fair values of the identifiable assets and liabilities, of the business combination at the date of acquisition have not been finalised as the acquisition occurred close to the date these financial statements were authorised for release. The acquired assets and liabilities includes publicly listed debt of CHF (Swiss Franc) 465.0m as at the acquisition close. Funds raised in anticipation of the acquisition are adequate to meet the need to repay the debt when it falls due in September 2022. The purchase price accounting for the acquisition will be determined within 12 months from the date of acquisition. At the date of this report, it is not possible to provide a range of outcomes or a reliable estimate of all fair values and obligations. Preliminary purchase price accounting estimates will be completed before the Group's statutory accounts for the half year ending 31 December 2022 are completed.

Note 3: Revenue and Expenses

Recognition and measurement of revenue

Revenue is recognised when the Group satisfies a performance obligation by transferring control of the promised good or service to a customer at an amount that reflects the consideration to which an entity expects to be entitled in exchange for the goods or services.

Further information about each source of revenue from contracts with customers and the criteria for recognition follows.

Sales: Revenue is earned (constrained by variable considerations, which include returns, discounts, rebates and allowances) from the sale of products and services. Sales are recognised when performance obligations are either satisfied over time or at a point in time. Generally the supply of product under a contract with a customer will represent the satisfaction of a performance obligation at a point in time, which is when control of the product passes to the customer.

Notes to the Financial Statements Note 3: Revenue and Expenses continued

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Key Judgements and Estimates

Significant estimates on CSL Seqirus sales returns is performed in respect of the influenza season expected to be subject to return. The estimate is performed with inputs including historical returns and customer sales data amongst other factors. For contracts where the customer controls the plasma (tolling contracts) and the Group provides fractionation services – the Group recognises revenue over time as the performance obligations are satisfied based upon a percentage of completion of our fractionation services.

Royalties: Revenue from licensees of CSL intellectual property reflect a right to use the intellectual property as it exists at the point in time in which the licence is granted. Where consideration is based on sales of product by the licensee, it is recognised when the customer’s subsequent sales of product occurs.

License revenue: Revenue from licensees of CSL intellectual property reflects the transfer of a right to use the intellectual property as it exists at the point in time in which the licence is transferred to the customer. Consideration is highly variable and estimated using the most likely amount method. Subsequently, the estimate is constrained until it is highly probable that a significant revenue reversal will not occur when the uncertainty is resolved. Revenue is recognised as or when the performance obligations are satisfied.

Influenza pandemic facility reservation fees: Revenue from governments in return for access to influenza manufacturing facilities in the event of a pandemic. Contracts are time-based and revenue is recognised progressively over the life of the relevant contract, which aligns to the performance obligations being satisfied.

Other Income: Other income is derived from net income realised from activities that are outside of the ordinary business, such as the disposal of property, plant and equipment and rental income.

Revenue from contracts with customers includes amounts in total operating revenue except other income.

	2022	2021
Expenses	US$m	US$m
Finance costs	142.8	128.6
Lease related interest expense	35.2	30.1
Unrealised foreign currency (gains)/losses on debt	(12.8)	12.1
Total finance costs	165.2	170.8
Depreciation of PPE and right-of-use assets (Note 9)	445.7	399.4
Amortisation of intangibles (Note 8)	96.8	95.9
Impairment expenses (Notes 8 and 9)2	125.8	94.3
Total depreciation, amortisation and impairment expense	668.3	589.6
Write-down of inventory	223.8	208.3
Employee benefits expense	2,802.9	2,781.6

Recognition and measurement of expenses

Total finance costs: Includes interest expense and borrowing costs, including lease related interest expense. Lease related interest expense and borrowing costs are recognised as an expense when incurred, except where finance costs are directly attributable to the acquisition or construction of a qualifying asset where they are capitalised as part of the cost of the asset. Capitalised interest for qualifying assets during the year ended 30 June 2022 was $26.7m (2021: $7.3m). The weighted average interest rate applicable to capitalised borrowing costs during the year was 2.4% (2021: 1.0%). Interest-bearing liabilities and borrowings are stated at amortised cost. Any difference between borrowing proceeds (net of transaction costs) and the redemption value is recognised in the statement of comprehensive income over the borrowing period using the effective interest method. Unrealised foreign currency (gains)/losses on debt is primarily related to EUR350m and CHF400m of senior unsecured notes in the US Private Placement market. The foreign currency risk related to this debt was partially hedged as a cash flow hedge.

In connection with the 144A senior unsecured notes (Note 2), the Group entered into a treasury lock (“T-lock”) prior to the completion of the issuance of the notes to hedge against increases in the Base US Treasury Yield until the settlement date for a portion of the notes. The T-lock arrangement was determined to be an effective cash flow hedge and resulted in a gain of $134.7m being recognised in the statement of comprehensive income. This amount will be reclassified into finance costs in the same period as the associated interest expense from the notes impacts earnings. For the year ended 30 June 2022, $1.0m was reclassified into finance costs.

Goods and Services Tax (GST) and other foreign equivalents: Revenues, expenses and assets are recognised net of GST, except where GST is not recoverable from a taxation authority, in which case it is recognised as part of an asset’s cost of acquisition or as part of the expense.

2 During the year ended 30 June 2022, the Group impaired certain intellectual property assets associated with the Calimmune acquisition ($112.6m). The net impact to the profit or loss from all Calimmune related adjustments was a loss of $24.8m (refer to Note 1 for further details).

Notes to the Financial Statements Note 4: Tax

		2022 US$m	2021
			US$m
a.	Income tax expense recognised in the statement of comprehensive income
	Current tax expense
	Current Year	353.6	442.2
	Deferred tax expense/(recovery)		127.5
	Origination and reversal of temporarydifferences	222.8
	Total deferred tax expense	222.8	127.5
	(Over)/underprovided inprioryears	(51.5)	18.4
	Income tax expense	524.9	588.1
b.	Reconciliation between tax expense andpre-tax netprofit	2,779.6
	The reconciliation between tax expense and the product of accounting profit before income tax multiplied by the Group’s applicable income tax rate is as follows:
	Accounting profit before income tax		2,963.1
	Income tax calculated at 30%(2021: 30%)	833.9 888.9 (247.6) (217.1) (62.7) (69.1) (51.5) 18.4 17.7 (19.8) 35.1 (13.2)	888.9
	Effects of different rates of tax on overseas income
	Research and development incentives
	(Over)/underprovision inprioryear
	Revaluation of deferred tax balances		(19.8)
	Other non-deductible expenses/(non-assessable revenue)		(13.2)
	Income tax expense	524.9	588.1
c.	Income tax recognised directly in equity	0.1
	Deferred tax benefit
	Share-basedpayments		6.2
	Income tax benefit recognised in equity	0.1	6.2
d.	Deferred tax assets and liabilities	517.5 (670.1)
	Deferred tax asset		529.5
	Deferred tax liability		(459.4)
	Net deferred tax asset	(152.6)	70.1
	Deferred tax balances reflect temporary differences attributable to:	134.6 291.8 (352.4) (301.5) (215.2) (253.4) 160.4 93.1 3.0 95.7 23.1 55.2 (97.5) (83.4) — 2.8 50.3 57.7 88.3 68.5 17.9 8.8
	Amounts recognised in the statement of comprehensive income
	Inventories		291.8
	Property, plant and equipment
	Intangible assets
	Trade and otherpayables
	Recognised carry-forward tax losses
	Retirement liabilities,net
	Receivables and contract assets
	Other assets
	Interest-bearingliabilities
	Other liabilities andprovisions
	Tax bases not in net assets for share-basedpayments		8.8
	Total recognised in the statement of comprehensive income	(187.5)	35.3
	Amounts recognised in equity Share-basedpayments	34.9	34.8
	Net deferred tax asset	(152.6)	70.1
e.	Movement in temporary differences during theyear	70.1 191.0 (213.4) (97.5) 0.3 (17.2) (9.6) (6.2)
	Openingbalance		191.0
	Charged toprofit before tax
	Charged to other comprehensive income
	Charged to equity		(6.2)
	Closing balance	(152.6)	70.1
	Unrecognised deferred tax assets
	Tax losses with no expirydate3	0.4	0.4

3 Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable profit will be available for utilisation in the entities that have recorded these losses.

Notes to the Financial Statements Note 4: Tax continued

Current taxes

Deferred tax is measured using tax rates and laws that are enacted at the reporting date and are expected to apply when the related deferred income tax asset is realised or when the deferred income tax liability is settled.

Current tax assets and liabilities are the amounts expected to be recovered from (or paid to) tax authorities, under the tax rates and laws in each jurisdiction. These include any rates or laws that are enacted or substantively enacted as at the balance sheet date.

Deferred tax assets and liabilities are offset only if a legally enforceable right exists to set-off current tax assets against current tax liabilities and if they relate to the same taxable entity or group and the same taxation authority.

Deferred taxes

Deferred tax liabilities are recognised for taxable temporary differences. Deferred tax assets are recognised for deductible temporary differences, carried forward unused tax assets and unused tax losses, only if it is probable that taxable profit will be available to utilise them.

Income taxes attributable to amounts recognised in other comprehensive income or directly in equity are also recognised in other comprehensive income or in equity, and not in the income statement.

CSL Limited and its 100% owned Australian subsidiaries have formed a tax consolidated group effective from 1 July 2003.

The carrying amount of deferred income tax assets is reviewed at the reporting date. If it is no longer probable that taxable profit will be available to utilise them, they are reduced accordingly.

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Key Judgements and Estimates

The risk of uncertain tax positions, and recognition and recoverability of deferred tax assets, are regularly assessed. To do this requires judgements about the application of income tax legislation in jurisdictions in which the Group operates and the future operating performance of entities with carry forward losses. These judgements and assumptions, which include matters such as the availability and timing of tax deductions and the application of the arm’s length principle to related party transactions, are subject to risk and uncertainty. Changes in circumstances may alter expectations and affect the carrying amount of deferred tax assets and liabilities. Any resulting adjustment to the carrying value of a deferred tax item will be recorded as a credit or charge to the statement of comprehensive income.

Note 5: Inventories

	2022	2021
	US$m	US$m
Raw materials	1,515.2	1,309.1
Work in progress	1,599.5	1,249.6
Finished goods	1,218.3	1,221.9
Total inventories	4,333.0	3,780.6

Raw Materials

Inventories generally have expiry dates and the Group provides for product that is short-dated. Expiry dates for raw material are no longer relevant once the materials are used in production. The relevant expiry date at this point then becomes that of the resultant intermediate or finished product.

Raw materials comprise collected and purchased plasma, chemicals, filters and other inputs to production that will be further processed into saleable products but have yet to be allocated to manufacturing.

Inventories are carried at the lower of cost or net realisable value. Cost includes direct material and labour and an appropriate proportion of variable and fixed overheads. Fixed overheads are allocated on the basis of normal operating capacity.

Work in Progress

Work in progress comprises all inventory items that are currently in use in manufacturing and intermediate products such as pastes generated from the initial stages of the plasma production process.

Net realisable value is the estimated revenue that can be earned from the sale of a product less the estimated costs of both completion and selling.

Finished Products

Finished products comprise material that is ready for sale and has passed all quality control tests.

The Group assesses net realisable value of plasma derived products on a basket of products basis given their joint product nature.

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Key Judgements and Estimates

Various factors affect the assessment of recoverability of the carrying value of inventory, including regulatory approvals and future demand for the Group’s products. These factors are taken into account in determining the appropriate level of provisioning for inventory.

Notes to the Financial Statements Note 6: People Costs

(a) Employee Benefits

Employee benefits include salaries and wages, annual leave and long-service leave, defined benefit and defined contribution plans and share-based payments incentive awards.

People Cost 2022 - US$2,802.9m

People Cost 2021 - US$2,781.6m

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Salaries and wages $2,597.0m Defined benefit plan expense $41.5m Defined contribution plan expense $47.6m Equity settled share-based payments expense (LTI) $116.8m

==> picture [91 x 88] intentionally omitted <==

Salaries and wages $2,595.1m Defined benefit plan expense $53.8m Defined contribution plan expense $43.0m Equity settled share-based payments expense (LTI) $89.7m

Salaries and wages

Wages and salaries include non-monetary benefits, annual leave and long service leave. These are recognised and presented in different ways in the financial statements:

The liability for annual leave and the portion of long service leave expected to be paid within twelve months is measured at the amount expected to be paid.
The liability for long service leave and annual leave expected to be paid after one year is measured as

the present value of expected future payments to be made in respect of services provided by employees up to the reporting date.

The liability for annual leave and the portion of long service leave that has vested at the reporting date is included in the current provision for employee benefits.
The portion of long service leave that has not vested at the reporting date is included in the noncurrent provision for employee benefits.

Defined benefit plans

Defined benefit plans
	2022	2021
	US$m	US$m
Expenses recognised in the income statement are as follows:
Current service costs	42.3	52.3
Net interest cost	3.0	1.4
Past service costs	(3.8)	0.1
Total included in employee benefits expense	41.5	53.8

Defined benefit pension plans provide either a defined lump sum or ongoing pension benefits for employees upon retirement, based on years of service and final average salary.

Liabilities or assets in relation to these plans are recognised in the balance sheet, measured as the present value of the obligation less the fair value of the pension fund’s assets at that date.

Present value is based on expected future payments to the reporting date, calculated by independent actuaries using the projected unit credit method. Past service costs are recognised in income on the earlier of the date of plan amendments or curtailment, and the date that the Group recognises restructuring related costs.

Detailed information about the Group’s defined benefit plans is in Note 18(a).

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Key Judgements and Estimates

The determination of certain employee benefit liabilities requires an estimation of future employee service periods and salary levels and the timing of benefit payments. These assessments are made based on past experience and anticipated future trends. The expected future payments are discounted using the rate applicable to high quality corporate bonds. Discount rates are matched to the expected payment dates of the liabilities.

Notes to the Financial Statements Note 6: People Costs continued

Defined contribution plans

The Group makes contributions to various defined contribution pension plans and the Group’s obligation is limited to these contributions. The amount recognised as an expense for the year ended 30 June 2022 was $47.6m (2021: $43.0m).

Equity settled share-based payment expense

Share-based payment expenses arise from plans that award long-term incentives. Detailed information about the terms and conditions of the share-based payment arrangements is presented in Note 18(b).

Outstanding share-based payment equity instruments

The number and weighted average exercise price for each share-based payment plan outstanding is as follows. All plans are settled by physical delivery of shares except for instruments that may be settled in cash at the discretion of the Board.

	Performance Rights Retain and Grow Plan (RGP) Executive Performance and Alignment Plan (EPA) Non-Executive Director Plan (NED) Global Employee Share Plan (GESP) Total
	Number Weighted average exercise price Number Weighted average exercise price Number Weighted average exercise price Number Weighted average exercise price Number Weighted average exercise price Number
Outstanding at the beginning of the year	8,350 A$0.00 801,366 A$0.00 426,121 A$0.00 1,333 A$0.00 99,212 A$229.74 1,336,382
Granted during year	— A$0.00 539,110 A$0.00 183,972 A$0.00 2,449 A$0.00 188,405 A$223.07 913,936
Exercised during year4	(8,350) A$0.00 (315,709) A$0.00 (148,680) A$0.00 (2,529) A$0.00 (184,141) A$225.78 (659,409)
Forfeited during year	— A$0.00 (94,188) A$0.00 (57,305) A$0.00 — A$0.00 — A$0.00 (151,493)
GESP true-up5	— A$0.00 — A$0.00 — A$0.00 — A$0.00 (4,724) A$229.74 (4,724)
Closing balance at the end of the year	— A$0.00 930,579 A$0.00 404,108 A$0.00 1,253 A$0.00 98,752 A$221.94 1,434,692
Exercisable at the end of the year	— A$0.00 — A$0.00 — A$0.00 — A$0.00 — A$0.00 —

The share price at the dates of exercise (expressed as a weighted average) by equity instrument type, is as follows:

	2022	2021
Performance Rights	A$297.02	A$290.92
RGP	A$308.97	A$280.98
EPA	A$309.08	A$281.68
GESP	A$303.87	A$263.25

(b) Key Management Personnel Disclosures

The remuneration of key management personnel is disclosed in section 17 of the Directors’ Report and has been audited.

Total compensation for key management personnel

Total compensation for key management personnel
	2022	2021
	US$	US$
Total of short term remuneration elements	10,880,861	9,280,941
Total of post employment elements	180,451	142,694
Total of other long term elements	24,438	26,173
Total share-based payments	10,229,740	11,751,250
Total of all remuneration elements	21,315,490	21,201,058

4 During the year ended 30 June 2022, 21,689 (RGP), 65 (EPA) and 89,653 (GESP) of the rights exercised were purchased on market.

5 The fair value of GESP equity instruments is estimated based on the assumptions prevailing on the grant date. In accordance with the terms and conditions of the GESP plan, shares are issued at 15% discount to the lower of the ASX market price on the first and last dates of the contribution period.

Notes to the Financial Statements Our Future

Note 7: Research and Development

The Group conducts research and development activities to support future development of products to serve our patient communities, to enhance our existing products and to develop new therapies.

All costs associated with our research and development activities are expensed as incurred as uncertainty exists up until the point of regulatory approval as to whether a research and development project will be successful. At the point of approval, the total cost of development has largely been incurred. Development costs incurred after regulatory approval are expensed unless it meets the criteria to be recognised as intangible assets.

The Group also gains control of Intellectual Property (IP) through acquisitions or licence arrangements. In certain circumstances the acquired IP will be capitalised, dependant on the phase of development.

For the year ended 30 June 2022, the research and development costs, net of recoveries, were $1,156.2m (2021: $1,001.4m). Further information about the Group’s research and development activities can be found on the CSL website.

Note 8: Intangible Assets

Year	Goodwill Intellectual Property Software Intangible work in progress Total US$m US$m US$m US$m US$m
	2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
Cost Accumulated amortisation	1,187.3 1,188.1 1,133.0 1,131.1 785.6 789.8 119.9 77.7 3,225.8 3,186.7 — — (189.9) (195.6) (397.8) (321.4) — — (587.7) (517.0)
Net carrying amount	1,187.3 1,188.1 943.1 935.5 387.8 468.4 119.9 77.7 2,638.1 2,669.7
Movement Net carrying amount at the beginning of the year 1,188.1 1,187.2 935.5 509.5 468.4 460.9 77.7 133.4 2,669.7 2,291.0 Additions — — 126.0 450.0 6.6 8.1 64.8 31.3 197.4 489.4 Transfers from intangible capital work in progress — — — — 24.1 84.1 (24.1) (84.1) — — Transfers (to)/from property, plant and equipment — — — — — — — (0.9) — (0.9) Reclassification due to SaaS accounting policy change (see annual financial report at 30 June 2021) — — — (5.1) — (10.3) — (1.2) — (16.6) Amortisation for the year — — (2.3) (0.9) (94.5) (95.0) — — (96.8) (95.9) Impairment for the year6 — — (112.6) (19.9) — — — — (112.6) (19.9) Currency translation differences (0.8) 0.9 (3.5) 1.9 (16.8) 20.6 1.5 (0.8) (19.6) 22.6
Net carrying amount at the end of the year 1,187.3 1,188.1 943.1 935.5 387.8 468.4 119.9 77.7 2,638.1 2,669.7

Goodwill

Any excess of the fair value of the purchase consideration of an acquired business over the fair value of the identifiable net assets (minus incidental expenses) is recorded as goodwill.

Goodwill is initially allocated to each of the cash-generating units but is monitored at the segment (business unit) level. The aggregate carrying amounts of goodwill allocated to each business unit are as follows:

	2022	2021
	US$m	US$m
CSL Behring	1,187.3	1,188.1
Closing balance of goodwill as at 30 June	1,187.3	1,188.1

Goodwill is not amortised but is measured at cost less any accumulated impairment losses. Impairment occurs when a business unit’s recoverable amount falls below the carrying value of its net assets.

The results of the impairment test show that each business unit’s recoverable amount exceeds the carrying value of its net assets, inclusive of goodwill. Consequently, there is no goodwill impairment as at 30 June 2022 (2021: Nil).

A change in assumptions significant enough to lead to impairment is not considered a reasonable possibility.

6 During the year ended 30 June 2022, the Group impaired certain intellectual property assets associated with the Calimmune acquisition ($112.6m). The net impact to the profit or loss from all Calimmune related adjustments was a loss of $24.8m (refer to Note 1 for further details).

Notes to the Financial Statements

Note 8: Intangible Assets continued

Intellectual property

Intellectual property acquired in a business combination is initially measured at fair value. Intellectual property acquired separately is initially measured at cost. Following initial recognition, it is carried at cost less any accumulated amortisation and impairment. Amortisation is calculated on a unit-ofproduction or straight-line basis over periods generally ranging from 5 to 20 years, except where it is considered that the useful economic life is indefinite. Certain intellectual property acquired may be considered to have an indefinite life.

Contingent consideration in connection with the purchase of individual assets outside of business combinations is recognised as a financial liability only when a non-contingent obligation arises (i.e. when milestone is met). The determination of whether the payment should be capitalised or expensed is usually based on the reason for the contingent payment. If the contingent payment is based on regulatory approvals received (i.e. development milestone), it will generally be capitalised as the payment is incidental to the acquisition so the asset may be made available for its intended use. If the contingent payment is based on period volumes sold (i.e. sales related milestone), it will generally be expensed.

Changes in the fair value of financial liabilities from contingent consideration should be capitalised or expensed based on the nature of the asset acquired (refer above), except for changes due to interest rate fluctuations and the effect from unwinding discounts. Interest rate effects from unwinding of discounts as well as changes due to interest rate fluctuations are recognised as finance costs.

Software

Costs incurred in developing or acquiring software, licences or systems that will contribute future financial benefits are capitalised. These include external direct costs of materials and service and direct payroll and payroll related costs of employees’ time spent on the project. Amortisation is calculated on a straight-line basis over periods generally ranging from 3 to 10 years. IT development costs include only those costs directly attributable to the development phase and are only recognised following completion of technical feasibility, where the Group has the intention and ability to use the asset.

Software-as-a-Service (SaaS) arrangements

SaaS arrangements are service contracts providing the Group with the right to access the cloud provider’s application software over the contract period. The Group applies judgement in determining the nature and the resulting accounting treatment of the costs of SaaS arrangements.

Costs incurred to configure or customise, and the ongoing fees to obtain access to the cloud provider's application software, are recognised as operating expenses when the services are received. Some of these costs incurred are for the development of software code that enhances or modifies, or creates additional capability to, existing on-premise systems and meets the definition of and recognition criteria for an intangible asset. These costs are recognised as intangible software assets and amortised over the useful life of the software.

Recognition and measurement

The useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets with finite lives are amortised over the useful life of the asset on a straight-line basis. Significant software intangible assets are amortised over the useful life of up to ten years. The amortisation period and method is reviewed at each financial year end at a minimum. Intangible assets with indefinite useful lives are not amortised. The useful life of these intangibles is reviewed each reporting period to determine whether indefinite life assessment continues to be supportable.

Impairment of intangible assets

Assets with finite lives are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Intangible assets that have an indefinite useful life (including goodwill) or not yet ready for use are tested annually for impairment or more frequently if events or changes in circumstances indicate that they may be impaired.

An impairment loss is recognised in the statement of comprehensive income for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating units), other than goodwill that is monitored at the segment level.

Impairment losses recognised in respect of cash generating units are allocated first to reduce the carrying amount of any goodwill allocated to cash generating units, and then to reduce the carrying amount of the other assets in the unit on a pro-rata basis.

Notes to the Financial Statements Note 8: Intangible Assets continued

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Key Judgements and Estimates

The impairment assessment process requires significant judgement. Determining whether goodwill, indefinite lived intangibles and work in progress intangibles have been impaired requires estimation of the recoverable amount of the cash generating units based on value-in-use calculations. The calculations use cash flow projections based on operating budgets and a ten-year strategic business plan, after which a terminal value, based on our view of the longer term growth profile of the business is applied. Cash flows have been discounted using an implied pre-tax discount rate of 9.0% (2021: 8.0%) which is calculated with reference to external analyst views, long-term government bond rates and the company’s pre-tax cost of debt.

The determination of cash flows over the life of an asset requires judgement in assessing the future demand for the Group’s products, climate related impacts, any changes in the price and cost of those products and of other costs incurred by the Group.

Factors considered in the exercise of our judgement include the progress of the research project, time to market and the anticipated competitive landscape. These factors require judgement and may change in future periods, the impairment analysis takes into account the latest available information.

Note 9: Property, Plant and Equipment

					Leasehold	Leasehold	Plant and	Plant and	Right-of-use	Right-of-use	Capital work in
	Land		Buildings		improvements		Equipment		assets		progress	Total
	US$m		US$m		US$m		US$m		US$m		US$m	US$m
	2022	2021	2022	2021	2022	2021	2022	2021	2022	2021	2022 2021	2022	2021
Cost	35.5	39.5	1,818.9	964.3	597.4	546.0	4,078.4	3,603.4	1,848.8	1,587.6	3,081.63,627.8	11,460.6	10,368.6
Accumulated depreciation	—	—	(297.2)	(253.4)	(181.9)	(157.0)	(2,116.1)	(1,936.3)	(556.8)	(485.9)	— —	(3,152.0)	(2,832.6)
Net carrying amount	35.5	39.5	1,521.7	710.9	415.5	389.0	1,962.3	1,667.1	1,292.0	1,101.7	3,081.63,627.8	8,308.6	7,536.0
Movement
Net carrying amount at
the start of the year	39.5	38.7	710.9	561.7	389.0	324.8	1,667.1	1,588.3	1,101.7	939.4	3,627.82,852.5	7,536.0	6,305.4
Transferred from capital
work in progress /
intangible assets	—	—	879.1	157.2	56.7	79.8	614.6	266.5	—	—	(1,550.4)(502.6)	—	0.9
Additions7	—	0.4	2.4	0.5	0.7	2.8	9.7	49.0	301.0	238.8	1,083.61,318.5	1,397.4	1,610.0
Disposals	(3.5)	—	(1.5)	—	(0.3)	(0.1)	(4.4)	(4.1)	(0.2)	—	(1.6) (8.1)	(11.5)	(12.3)
Depreciation for the year	—	—	(50.8)	(29.2)	(26.9)	(20.7)	(277.5)	(272.4)	(90.5)	(77.1)	— —	(445.7)	(399.4)
Impairment for the year8	—	—	—	—	—	—	—	—	—	—	(13.2) (74.4)	(13.2)	(74.4)
Currency translation
differences	(0.5)	0.4	(18.4)	20.7	(3.7)	2.4	(47.2)	39.8	(20.0)	0.6	(64.6) 41.9	(154.4)	105.8
Net carrying amount at
the end of the year	35.5	39.5	1,521.7	710.9	415.5	389.0	1,962.3	1,667.1	1,292.0	1,101.7	3,081.63,627.8	8,308.6	7,536.0

Property, plant and equipment

Land, buildings, capital work in progress and plant and equipment assets are recorded at historical cost less, where applicable, depreciation.

Right-of-use assets are measured at cost, less accumulated depreciation, impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities and restoration obligations recognised less any lease incentives received and initial direct costs.

Depreciation is recognised on a systematic basis over the estimated useful life of the asset, generally on a straight-line basis.

Buildings 5 – 40 years Plant and equipment 3 – 30 years Leasehold improvements 5 – 25 years

Right-of-use assets

Plasma centres 5 - 40 years - Office and warehouses 1 - 39 years - Land 40 - 101 years

The unit-of-production depreciation method, based on the expected use or output as the asset is being used, may be applied during the early stages of operation of manufacturing facilities, as a substantial period of time may be required to ramp up the production and operate at intended capacity. This method is to be applied consistently from period to period unless there is a change in the expected pattern of consumption of those future economic benefits.

Assets’ residual values and useful lives are reviewed and adjusted if appropriate at each reporting date. Items of property, plant and equipment are derecognised upon disposal or when no further economic benefits are expected from their use or disposal.

7 Key capital projects during the year included the recombinant protein facility in Lengnau, the Marburg R&D Building, the CSL Melbourne Headquarters and R&D facilities and the Biosecurity Facility in Melbourne.

8 During the year ended 30 June 2022, the Group recorded an impairment expense of $13m for assets associated with major capital projects which have been identified as surplus to requirements as a result of the change in project scope for these projects.

Notes to the Financial Statements

Note 9: Property, Plant and Equipment continued

Property, plant and equipment continued

Impairment testing for property, plant and equipment will be performed if an impairment trigger is identified.

Gains and losses on disposals of items of property, plant and equipment are determined by comparing proceeds with carrying amounts and are included in the statement of comprehensive income when realised.

40% of the Holly Springs facility, acquired with the Novartis Influenza business, was legally owned by the US Government prior to 1 July 2021. CSL has full control of the asset and 100% of the value of the facility is included in the consolidated financial statements. During the year ended 30 June 2022, full legal title transferred to CSL following the completion of the Final Closeout Technical Report.

Leasehold improvements

The cost of improvements to leasehold properties is amortised over the unexpired period of the lease or the estimated useful life of the improvement, whichever is the shorter.

Right-of-use ("ROU") assets

The Group primarily has leases for plasma centres, office buildings, warehouses, land and vehicles.

Except for short-term leases and leases of low value assets, the Group recognises right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). The Group accounting policy for lease liabilities has been discussed in Note 11(d).

Unless the Group is reasonably certain to obtain ownership of the underlying asset at the end of the lease term, the recognised right-of-use assets are depreciated on a straight-line basis over the shorter of its estimated useful life and the lease term.

Other arrangements

In May 2020, CSL entered into a strategic partnership with Thermo Fisher Scientific ("TFS") which included a lease of a recombinant protein facility in Lengnau. The lease commenced during the year ended 30 June 2022 and has a 20 year term with two five year extension options. The lease has been accounted for as an operating lease and the leased property, plant and equipment continue to be presented in the balance sheet. The total future operating lease payments receivable from TFS (excluding extension options) were $454.1m at 30 June 2022.

Notes to the Financial Statements Returns, Risk & Capital Management

Note 10: Shareholder Returns

(a) Dividends

Dividends are paid from the retained earnings and profits of CSL Limited, as the parent entity of the Group. (Refer to Note 22 for the parent entity’s retained earnings). During the year, the parent entity reported profits of $506.8m (2021: $106.1m). The parent entity’s retained earnings as at 30 June 2022 were $6,322.6m (2021: $6,854.4m). During the financial year $1,038.7m was distributed to shareholders by way of a dividend, with a further $568.4m being determined as a dividend payable subsequent to the balance date.

	2022	2021
Dividend Paid	US$m	US$m
Paid: Final ordinary dividend of US$1.18 per share, 10% franked at 30% tax rate, paid on 30 September	537.7	484.7
2021 for FY21 (prior year: US$1.07 per share, unfranked, paid on 9 October 2020 for FY20)
Paid: Interim ordinary dividend of US$1.04 per share, unfranked, paid on 6 April 2022 for FY22 (prior	501.0	473.3
year: US$1.04 per share, unfranked, paid on 1 April 2021 for FY21)
Total paid	1,038.7	958.0
Dividend determined, but not paid at year end:
Final ordinary dividend of US$1.18 per share, 10% franked at 30% tax rate, expected to be paid on
5 October 2022 for FY22, based on shares on issue at reporting date. The aggregate amount of the
proposed dividend will depend on actual number of shares on issue at dividend record date (prior year:
US$1.18 per share, 10% franked at 30% tax rate, paid on 30 September 2021 for FY21)	568.4	537.0

The distribution in respect of the 2022 financial year represents a US$2.22 dividend paid for FY22 on each ordinary share held. These dividends are approximately 46.2% of the Group’s basic earnings per share ('EPS') of US$4.81.

(b) Earnings per Share

CSL’s basic and diluted EPS are calculated using the Group’s net profit for the year of $2,254.7m (2021: $2,375.0m).

	2022	2021
Basic EPS	US$4.81	US$5.22
Weighted average number of ordinary shares	468,754,857	454,865,604
Diluted EPS	US$4.80	US$5.21
Adjusted weighted average number of ordinary shares, represented by:	470,117,188	456,203,803
Weighted average number of ordinary shares	468,754,857	454,865,604
Plus:
Employee Share Plans (refer to Notes 6 and 18)	1,362,331	1,338,199

Diluted EPS differs from Basic EPS as the calculation takes into account potential ordinary shares arising from employee share plans operated by the Group.

(c) Contributed Equity

The following table illustrates the movement in the Group’s contributed equity. Refer to Note 12 for further details.

	2022 2021
	Number of shares US$m Number of shares US$m
Opening balance Shares issued to employees via (Notes 6 and 18): Performance Options Plan Performance Rights Plan (for nil consideration) Retain and Grow Plan (for nil consideration) Executive Performance & Alignment Plan (for nil consideration) Global Employee Share Plan (GESP) Shares issued through Institutional Placement (Note 2)9 Shares issued through SPP (Note 2)8	455,125,994 (4,504.6) 454,048,707 (4,561.0) — — 308,186 24.4 8,350 — 197,646 — 294,020 — 253,126 — 148,615 — 138,369 — 94,488 8.7 179,960 32.0 23,076,924 4,442.4 — — 2,957,875 537.3 — —
Closing balance	481,706,266 483.8 455,125,994 (4,504.6)

9 Proceeds from shares issued through the Institutional Placement and SPP are presented net of $40.6m in transaction costs.

Notes to the Financial Statements Note 11: Financial Risk Management

CSL holds financial instruments that arise from the Group’s need to access financing, from the Group’s operational activities and as part of the Group’s risk management activities. The Group is exposed to financial risks associated with its financial instruments. Financial instruments comprise cash and cash equivalents, receivables, contract assets, other financial assets, payables and other liabilities, bank loans and overdrafts, unsecured notes, and lease liabilities.

The primary risks these give rise to are:

Foreign exchange risk
Interest rate risk
Credit risk
Funding and liquidity risk
Capital management risk

Source of Risk	Risk Mitigation
a. Foreign Exchange Risk
The Group is exposed to foreign exchange risk because	Where possible CSL takes advantage of natural hedging (i.e. the
of its international operations. These risks relate to future	existence of payables and receivables in the same currency). The Group
commercial transactions, assets and liabilities	also reduces its foreign exchange risk on net investments in foreign
denominated in other currencies and net investments in	operations by denominating external borrowings in currencies that
foreign operations.	match the currencies of its foreign investments.
b. Interest Rate Risk
The Group is exposed to interest rate risk through its	The Group mitigates interest rate risk on borrowings primarily by
primary financial assets and liabilities.	entering into fixed rate arrangements, which are not subject to interest
	rate movements in the ordinary course. If necessary, CSL also hedges
	interest rate risk using derivative instruments (including the T-lock
	entered into and settled during the year as disclosed in Note 3 and Note
	12). As at 30 June 2022, no derivative financial instruments hedging
	interest rate risk were outstanding (2021: Nil).
c. Credit Risk
The Group is exposed to credit risk from financial	The Group mitigates credit risk from financial instruments contracts by
instruments contracts and trade and other receivables.	only entering into transactions with counterparties who have sound
The maximum exposure to credit risk at reporting date is	credit ratings. Given their high credit ratings, management does not
the carrying amount, net of any provision for impairment	expect any counterparty to fail to meet its obligations. The Group
inclusive of any lifetime expected credit losses under	minimises the credit risk associated with trade and other debtors by
AASB 9, if applicable, of each financial asset in the	undertaking transactions with a large number of customers in various
balance sheet.	countries. The Group enters into arrangements with distributors to sell
	products in some markets. Certain distributors may contribute to 10% or
	more revenue of the Group. Creditworthiness of customers is reviewed
	prior to granting credit, using trade references and credit reference
	agencies. As at 30 June 2022, the Group was holding larger than normal
	cash balances to fund the acquisition of Vifor (Note 2). The cash
	balances were held with appropriately rated counterparties in
	accordance with board approved policy.
d. Funding and Liquidity Risk
The Group is exposed to funding and liquidity risk from	The Group mitigates funding and liquidity risks by ensuring that:
operations and from external borrowing.	• The Group has sufficient funds on hand to achieve its working capital
One type of this risk is credit spread risk, which is the risk that in refinancing its debt, CSL may be exposed to an increased credit spread.	and investment objectives • The Group focuses on improving operational cash flow and maintaining a strong balance sheet
Another type of this risk is liquidity risk, which is the risk of not being able to refinance debt obligations or meet other cash outflow obligations when required.	• Short-term liquidity, long-term liquidity and crisis liquidity requirements are effectively managed, minimising the cost of funding and maximising the return on any surplus funds through efficient cash management
Liquidity and re-financing risks are not significant for the	• It has adequate flexibility in financing to balance short-term liquidity
Group, as CSL has a prudent gearing level and strong cash	requirements and long-term core funding and minimise refinancing
flows.	risk
e. Capital Risk Management
The Group’s objectives when managing capital are to	The Group aims to maintain a capital structure, which reflects the use of
safeguard its ability to continue as a going concern while	a prudent level of debt funding. The aim is to reduce the Group’s cost of
providing returns to shareholders and benefits to other	capital without adversely affecting the credit margins applied to the
stakeholders. Capital is defined as the amount	Group’s debt funding. Each year the Directors determine the dividend
subscribed by shareholders to the Company’s ordinary	taking into account factors such as profitability and liquidity.
shares and amounts advanced by debt providers to any
Group entity.

Notes to the Financial Statements Note 11: Financial Risk Management continued

Risk management approach

The Group uses sensitivity analysis (together with other methods) to measure the extent of financial risks and decide if they need to be mitigated. If so, the Group’s policy is to use derivative financial instruments, such as foreign exchange contracts and interest rate swap and forward contracts, to support its objective of achieving financial targets while seeking to protect future financial security. The aim is to reduce the impact of short-term fluctuations in currency or interest rates on the Group’s earnings. Derivatives are exclusively used for this purpose and not as trading or other speculative instruments.

a. Foreign Exchange Risk

The objective is to match the contracts with committed future cash flows from sales and purchases in foreign currencies to protect the Group against exchange rate movements. The Group reduces its foreign exchange risk on net investments in foreign operations by denominating external borrowings in currencies that match the currencies of its foreign investments. The total value of forward exchange contracts in place at reporting date is nil (2021: Nil).

b. Interest Rate Risk

At 30 June 2022, it is estimated that a general movement of one percentage point in the interest rates applicable to investments of cash and cash equivalents would have changed the Group’s profit after tax by approximately $9.5m (2021: $12.7m). This calculation is based on applying a 1% movement to the total of the Group’s cash and cash equivalents at year end (excluding debt and equity proceeds in connection with the acquisition of Vifor as disclosed in Note 2).

At 30 June 2022, it is estimated that a general movement of one percentage point in the interest rates applicable to floating rate unsecured bank loans would have changed the Group’s profit after tax by approximately $3.6m (2021: $3.9m). This calculation is based on applying a 1% movement to the total of the Group’s floating rate unsecured bank loans at year end.

Sensitivity analysis – USD values

Profit after tax – sensitivity to general movement of 1%

A movement of 1% in the USD exchange rate against AUD, EUR, CHF and GBP would not generate a material impact to profit after tax.

Equity – sensitivity to general movement of 1%

Any movement is recorded in the Foreign Currency Translation Reserve. The below chart is based on decreasing the actual exchange rate of US Dollars to AUD, EUR, CHF and GBP as at 30 June 2022 and 2021 by 1% and applying these adjusted rates to the net assets (excluding investments in subsidiaries) of the foreign currency denominated financial statements of various Group entities. Amounts shown are in US$m.

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15
10
5
0
-5
AUD EUR CHF GBP
2022 2021
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Notes to the Financial Statements Note 11: Financial Risk Management continued

c. Credit Risk

The Group only invests its cash and cash equivalent financial assets with financial institutions having a credit rating of at least ‘BBB+’ or better, as assessed by independent rating agencies.

	Floating Rate10 Non-Interest Bearing Total Average Closing Interest Rate
	US$m US$m US$m %
	2022 2021 2022 2021 2022 2021 2022 2021
Financial assets and contract assets Cash and cash equivalents Receivables and contract assets (excluding prepayments) Other financial assets11	10,436.4 1,808.8 — —10,436.4 1,808.8 0.86 % 0.02 % — — 1,496.0 1,570.3 1,496.0 1,570.3 — — — — 407.1 26.3 407.1 26.3 — —
	10,436.4 1,808.8 1,903.1 1,596.612,339.5 3,405.4

Credit quality of financial assets

(30 June 2022 in US$m)

Credit quality of financial assets

(30 June 2021 in US$m)

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Financial Institutions* $10,462.4m Governments $224.2m Hospitals $150.8m Buying Groups $398.8m Publicly traded securities $381.1m Other $722.2m

[$10,436.4m of the assets held with financial institutions are held as ] cash or cash equivalents and $26.0m of other financial assets. Financial assets held with non-financial institutions include $1,496.0m of trade and other receivables.

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Financial Institutions* $1,835.1m Governments $240.1m Hospitals $207.1m Buying Groups $457.9m Publicly traded securities $0.0m Other $665.2m

[$1,808.8m of the assets held with financial institutions are held as ] cash or cash equivalents and $26.3m of other financial assets. Financial assets held with non-financial institutions include $1,570.3m of trade and other receivables.

The Group has not renegotiated any material collection/repayment terms of any financial assets in the current financial year.

Government or government-backed entities (such as hospitals) often account for a significant proportion of trade receivables. As a result, the Group carries receivables from a number of Southern European governments. The credit risk associated with trading in these countries is considered on a country-by-country basis and the Group’s trading strategy is adjusted accordingly. The factors taken into account in determining the credit risk of a particular country include recent trading experience, current economic and political conditions and the likelihood of continuing support from agencies such as the European Central Bank.

The following table analyses trade receivables that are past due and, where required, the associated provision for expected credit losses (refer to Note 15). All other financial assets are less than 30 days overdue.

Trade receivables and contract assets	Gross Provision Net
	2022 2021 2022 2021 2022 2021 US$m US$m US$m US$m US$m US$m
current less than 30 days overdue between 30 and 90 days overdue more than 90 days overdue	1,083.0 1,140.3 (8.7) (9.6) 1,074.3 1,130.7 20.5 33.1 — — 20.5 33.1 40.2 16.5 — — 40.2 16.5 24.1 41.6 (8.2) (13.9) 15.9 27.7
	1,167.8 1,231.5 (16.9) (23.5) 1,150.9 1,208.0

10 Floating interest rates represent the most recently determined rate applicable to the instrument at balance sheet date. All interest rates on floating rate financial assets and liabilities are subject to reset within the next six months.

11 Other financial assets includes $381.1m in Vifor shares measured at fair value through OCI (Note 2 and Note 12).

Notes to the Financial Statements Note 11: Financial Risk Management continued

d. Funding and Liquidity Risk

The following chart summarises the Group's maturity profile of debt on an undiscounted basis by facility (US$m). The chart includes the maturity profile of the $4,000.0m in 144A senior unsecured notes excluding its mandatory redemption feature that existed at 30 June 2022 (Note 11(d)). The mandatory redemption feature required repayment of the 144A senior unsecured notes if the acquisition of Vifor had not completed by 31 December 2022. This mandatory redemption feature was removed subsequent to 30 June 2022 following the acquisition of Vifor (Note 2).

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1000
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800
700
600
500
400
300
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FY23 FY24 FY25 FY26 FY27 FY28 FY29 FY30 FY31 FY32 FY33 FY35 FY38 FY42 FY52 FY62
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The following table analyses the Group’s financial liabilities:

	2022	2021
Interest-bearing liabilities and borrowings	US$m	US$m
*Current*
Bank overdraft – unsecured	102.0	78.7
Bank borrowings – unsecured	202.7	66.2
Senior notes – unsecured	150.0	250.0
Senior 144A notes – unsecured12	3,959.2	—
Lease liabilities	73.5	77.8
Other borrowings – secured	6.6	1.1
	4,494.0	473.8
*Non-current*
Bank borrowings – unsecured	179.2	220.0
Senior notes – unsecured	3,675.3	3,993.9
Lease liabilities	1,301.3	1,104.6
Other borrowings – secured	8.0	14.6
	5,163.8	5,333.1

Interest-bearing liabilities and borrowings

Interest-bearing liabilities and borrowings are recognised initially at fair value, net of transaction costs incurred. Subsequent to initial recognition, interest-bearing liabilities and borrowings are stated at amortised cost, with any difference between the proceeds (net of transaction costs) and the redemption value recognised in the statement of comprehensive income over the period of the borrowings.

Fees paid on the establishment of loan facilities that are yield related are included as part of the carrying amount of the loans and borrowings. Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

12 The $3,959.2m in 144A senior unsecured notes, which are net of transaction costs of $40.8m, were issued on 27 April 2022 with the proceeds to be used to partially fund the acquisition of Vifor (Note 2) and for general corporate purposes. These notes were classified as current at 30 June 2022 due to the existence of a mandatory redemption feature at balance sheet date in the event the acquisition did not complete. Subsequent to 30 June 2022, the mandatory redemption feature was removed following the acquisition of Vifor (Note 2) and the notes that have contractual maturities beyond 12 months will be subsequently reclassified as non-current.

Notes to the Financial Statements

Note 11: Financial Risk Management continued

Lease liabilities

At the commencement date of the lease, the Group recognises lease liabilities measured at the present value of lease payments to be made over the lease term. In calculating the present value of lease payments, the Group uses the incremental borrowing rate of the lessee at the lease commencement date if the interest rate implicit in the lease is not readily determinable. The Group exercises judgement when determining the incremental borrowing rate based on the interest that the lessee would have to pay to borrow over a similar term, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment, and observable inputs such as market interest rates are used as applicable.

The lease payments include fixed payments (including in-substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the Group and payments of penalties for terminating a lease, if the lease term reflects the Group exercising the option to terminate. The variable lease payments that do not depend on an index or a rate are recognised as an expense in the period in which the event or condition that triggers the payment occurs. Subsequent to initial recognition, lease liabilities are measured at amortised cost. Lease liabilities are remeasured if there is a modification, such as a change in the lease term, a change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset.

The Group’s lease liabilities are inclusive of extension options the Group is reasonably certain to exercise based upon our judgement as at the reporting date. Lease extension options that the Group is not reasonably certain to exercise as at the reporting date are appropriately excluded from the lease liabilities. The Group applies judgement in evaluating whether it is reasonably certain to exercise the option to renew. That is, it considers all relevant factors that create an economic incentive for it to exercise the renewal. After the commencement date, the Group reassesses the lease term if there is a significant event or change in circumstances that is within its control and affects its ability to exercise (or not to exercise) the option to renew (e.g., a change in business strategy).

The Group applies the short-term lease recognition exemption to leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option. It also applies the lease of low-value assets recognition exemption, which relates to leases such as office photocopiers, gas storage cylinders, and other miscellaneous low value assets. Lease payments on short-term leases and leases of low-value assets are recognised as expense on a straight-line basis over the lease term.

Contractual maturities of financial liabilities

The following table categorises the financial liabilities into relevant maturity periods, taking into account the remaining period at the reporting date and the contractual maturity date. The weighted average contractual maturity date of financial liabilities (excluding trade and other payables and lease liabilities) has increased from 6 years as at 30 June 2021 to 12 years as at 30 June 2022. The amounts disclosed represent principal and interest cash flows, so they may differ from the equivalent reported amounts in the balance sheet.

	Contractual payments due as at 30 June 1 year or less Between 1 year and 5 years Over 5 years Total Weighted average interest rate US$m US$m US$m US$m %
	2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
Trade and other payables (non-interest bearing) Bank borrowings – unsecured (floating rates)13 Bank borrowings – unsecured (fixed rates) Bank overdraft – unsecured (floating rates)13 Senior unsecured notes (fixed rates) Senior unsecured 144A notes (fixed rates)14 Senior unsecured notes (floating rates)13 Lease liabilities (fixed rates) Other borrowings (fixed rates)	2,301.22,089.4 — — — —2,301.22,089.4 — — 62.7 31.2 — 36.4 — — 62.7 67.6 2.0% 1.8% 38.8 38.1 149.4 148.7 27.7 40.8 215.9 227.6 1.0% 1.0% 102.0 78.7 — — — — 102.0 78.7 — — 358.8 350.71,771.8 1,343.61,964.52,768.74,095.14,463.0 2.8% 2.8% 177.4 —1,209.5 —6,153.6 —7,540.5 — 4.1% — 12.6 5.0506.3 507.6 — — 518.9 512.6 2.5% 1.0% 79.2 108.7 283.3 365.11,011.91,095.61,374.41,569.4 3.0% 2.9% 7.3 7.4 4.4 5.6 5.7 6.1 17.4 19.1 5.1% 5.2%
	3,140.02,709.23,924.72,407.09,163.4 3,911.216,228.19,027.4

13 Floating interest rates represent the most recently determined rate applicable to the instrument at balance sheet date. All interest rates on floating rate financial assets and liabilities are subject to reset within the next six months.

14 Contractual maturities of financial liabilities excludes the mandatory redemption feature included within the 144A senior unsecured notes. Refer to Note 11(d) for detail regarding this redemption feature.

Notes to the Financial Statements

Note 11: Financial Risk Management continued

Available debt facilities

As at 30 June 2022, the Group had the following available interest-bearing liabilities and borrowings (undiscounted and excludes bank overdrafts and lease liabilities):

Unsecured

Five revolving committed bank facilities totalling US$1,604.0m, which includes US$1,542.5m in undrawn available funds
Senior unsecured notes in the the US private placement market totalling US$3,435.0m
Senior unsecured notes in the 144A US private placement market totalling US$4,000.0m
Unsecured notes in the Hong Kong market ("QDI") totalling US$500.0m
Commercial paper program totalling US$750.0m which remains undrawn and available
Bank facility ("KFW") totalling US$216.3m

In addition to the above, the Group entered into US$2,500.0m in bilateral credit facilities (floating rate) in May 2022 with proceeds restricted to the acquisition of Vifor (Note 2). Subsequent to 30 June 2022, the Group has completed the acquisition of Vifor (Note 2) and has drawn down the available $2,500.0m in August 2022.

Secured

Other secured borrowings totalling US$13.1m

The Group is in compliance with all debt covenants as at 30 June 2022.

e. Fair value of financial assets and financial liabilities

The carrying value of financial assets and liabilities is materially the same as the fair value. The following methods and assumptions were used to determine the net fair values of financial assets and liabilities.

Cash

The carrying value of cash equals fair value, due to the liquid nature of cash.

Receivables, contract assets and payables

Carrying value of receivables, contract assets and payables with a remaining life of less than one year is deemed to equal fair value.

Other financial assets

Other financial assets includes equity securities carried at fair value through other comprehensive income which are not held for trading. The publicly traded securities held in connection with the acquisition of Vifor (refer to Note 2 and Note 12(b)) are measured at fair value calculated based on quoted prices (unadjusted) in an active market.

Interest-bearing liabilities

Fair value is calculated based on the discounted expected principal and interest cash flows, using rates currently available for debt of similar terms, credit risk and remaining maturities.

Other financial liabilities

The Group also has foreign currency loans payable that have been designated as a cash flow hedge against forecast sale transactions in foreign currency. An effective hedge is one that meets certain criteria. Gains or losses on the cash flow hedge that relate to the effective portion of the hedge are recognised in equity. Gains or losses relating to the ineffective portion, if any, are recognised in the statement of comprehensive income. Other liabilities also includes contingent consideration liabilities from business combinations.

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Key Judgements and Estimates

Contingent consideration liabilities are valued with reference to our judgement of the expected probability and timing of potential future milestone payments, based upon level 3 inputs under the fair value hierarchy, which is then discounted to a present value using appropriate discount rates with reference to the Group's incremental borrowing rates.

Valuation of financial instruments

For financial instruments measured and carried at fair value, the Group uses the following to categorise the method used:

Level 1: Items traded with quoted prices in active markets for identical liabilities
Level 2: Items with significantly observable inputs other than quoted prices in active markets
Level 3: Items with unobservable inputs (not based on observable market data)

There were no transfers between Level 1 and Level 2 during the year, or any transfers into Level 3.

Notes to the Financial Statements

Note 11: Financial Risk Management continued

Note 11: Financial Risk Managementcontinued
		2022	2021
Financial assets/(liabilities) measured at fair value		US$m	US$m
Publicly traded securities (Note 2)	Level 1	381.1	—
Contingent consideration liabilities from business combinations (Note 15)15	Level 3	(268.6)	(345.8)

Note 12: Equity and Reserves

(a) Contributed Equity

Note 12: Equity and Reserves (a) Contributed Equity
	2022	2021
	US$m	US$m
Ordinary shares issued and fully paid	4,988.4	—
Share buy-back reserve	(4,504.6)	(4,504.6)
Total contributed equity	483.8	(4,504.6)

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from the proceeds. Where the Group reacquires its own shares, for example as a result of a share buy-back, those shares are cancelled. No gain or loss is recognised in the profit or loss and the consideration paid to acquire the shares, including any directly attributable transaction costs net of income taxes is recognised directly as a reduction in equity.

Ordinary shares receive dividends as declared and, in the event of winding up the company, participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held. Ordinary shares entitle their holder to one vote, either in person or proxy, at a meeting of the company.

Share buy-backs were undertaken at higher prices than the original subscription prices which reduced the historical balance for ordinary share contributed equity to nil. The share buy-back reserve was created to reflect the excess value of shares bought over the original amount of subscribed capital. Information relating to changes in contributed equity is set out in Note 10.

(b) Movement in Reserves

(b) Movement in Reserves
US$m	Share-based payments reserve (i) Foreign currency translation reserve (ii) Hedge reserve (iii) Other reserves (iv) Total
	2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
Opening balance Share-based payment expense Net exchange gains/(losses) on translation of foreign subsidiaries, net of hedging reserve Change in fair value of investments valued through OCI Fair value of cash flow hedge Reclassification to profit and loss Deferred tax	426.7 328.7 206.5 7.6 — — — — 633.2 336.3 116.8 91.8 — — — — — — 116.8 91.8 — — (286.9) 198.9 — — — —(286.9) 198.9 — — — — — — (6.6) — (6.6) — — — — — 134.7 — — — 134.7 — — — — — (1.0) — — — (1.0) — 0.1 6.2 — — — — — — 0.1 6.2
Closing balance	543.6 426.7 (80.4) 206.5 133.7 — (6.6) — 590.3 633.2

Nature and purpose of reserves

i. Share-based payments reserve

The share-based payments reserve is used to recognise the fair value of awards issued to employees.

ii. Foreign currency translation reserve

Where the functional currency of a subsidiary is not US dollars, its assets and liabilities are translated on consolidation to US dollars using the exchange rates prevailing at the reporting date, and its profit and loss is translated at average exchange rates.

All resulting exchange differences are recognised in other comprehensive income and in the foreign currency translation reserve in equity. Exchange differences arising from borrowings designated as hedges of net investments in foreign entities are also included in this reserve.

15 During the year ended 30 June 2022, the Group derecognised contingent consideration liabilities ($62.5m) for amounts payable to former shareholders of Calimmune. The net impact to the profit or loss from all related adjustments associated with the Calimmune acquisition (including impairment expense disclosed in Note 1 and Note 3) was a loss of $24.8m.

Notes to the Financial Statements Note 12: Equity and Reserves continued

iii. Hedge reserve

The hedge reserve recognises the effective portion of gains and losses on derivatives that are designated and qualify as hedges. Amounts are subsequently reclassified into the profit and loss as appropriate. The hedge reserve includes the cash flow hedge reserve associated with the T-lock which settled during 30 June 2022 (refer to Note 3).

iv. Other reserves

Other reserves includes equity securities purchased in connection with the acquisition of Vifor (refer to Note 2 and Note 11(e)). The Group has elected to recognise changes in the fair value of these investments in equity securities in OCI (excluding dividend income). These changes are accumulated within the other reserves within equity. The Group transfers amounts from this reserve to retained earnings when the relevant equity securities are derecognised.

Note 13: Commitments and Contingencies

(a) Capital Commitments

Commitments in relation to capital expenditure contracted but not provided for in the financial statements are payable as follows:

payable as follows:
	Capital Commitments
	2022 2021
	US$m US$m
Not later than one year Later than one year but not later than five years	403.2 520.0 83.3 24.3
Total	486.5 544.3

The Company entered into a lease for a building, currently under construction in Melbourne, as the new global headquarters. The lease is expected to commence in 2023 with an initial term of 20 years and annual lease costs of approximately $15.0m.

(b) Contingent assets and liabilities

Litigation

In the ordinary course of business, the Group is exposed to contingent liabilities related to litigation for breach of contract and other claims. Contingent liabilities occur when the possibility of a future settlement of economic benefits is considered to be less than probable but more likely than remote. If the expected settlement of the liability becomes probable, a provision is recognised.

Other contingent assets and liabilities

The Group has entered into collaboration arrangements, including in-licensing arrangements with various companies. Such collaboration agreements may require the Group to make payments on achievement of stages of development, launch or revenue milestones and may include variable payments that are based on unit sales (e.g. royalty payments). The amount of royalties payable under the arrangements are inherently uncertain and difficult to predict, given the direct link to future sales and the range of outcomes.

The maximum amount of unrecognised potential future commitments for such payments associated with uniQure and Momenta licensing arrangements amount to $2,050.0m (2021: $2,105.0m). These amounts are undiscounted and are not risk-adjusted, which include all such possible payments that can arise assuming all products currently in development are successful and all possible performance objectives are met.

Notes to the Financial Statements Efficiency of Operation

Note 14: Cash and Cash Equivalents

Efficiency of Operation Note 14: Cash and Cash Equivalents
	2022	2021
	US$m	US$m
Cash at bank and on hand	1,531.0	1,426.0
Cash deposits	8,905.4	382.8
Total cash and cash equivalents16	10,436.4	1,808.8

Cash and cash equivalents are held for the purpose of meeting short term cash commitments rather than for investment or other purposes. They are made up of:

Cash on hand.
At call deposits with banks or financial institutions.
Investments in money market instruments that are readily convertible to known amounts of cash and subject to insignificant risk of changes in value.

For the purposes of the cash flow statement, cash at the end of the financial year is net of bank overdraft amounts.

Cash flows are presented on a gross basis. The GST component of cash flows arising from investing and financing activities that are recoverable from or payable to a taxation authority are presented as part of operating cash flows.

Note 15: Receivables, Contract Assets and Payables

(a) Receivables and contract assets

Note 15: Receivables, Contract Assets and Payables (a) Receivables and contract assets
	2022	2021
	US$m	US$m
Current
Trade receivables	965.8	997.0
Contract assets	202.0	234.5
Less: Provision for expected credit losses	(16.9)	(23.5)
	1,150.9	1,208.0
Other receivables	332.3	355.7
Prepayments	174.0	147.5
Carrying amount of current receivables and contract assets	1,657.2	1,711.2
Non-Current
Long term deposits/other receivables	12.8	6.6
Carrying amount of non-current receivables and contract assets17	12.8	6.6

Receivables are initially recorded at their transaction price and are generally due for settlement within 30 to 60 days from date of invoice. Collectability is regularly reviewed at an operating unit level.

A provision for expected credit losses (ECL) is recognised based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original effective interest rate. Cash flows relating to short-term receivables are not discounted if the effect of discounting is immaterial. When a trade receivable for which a provision for expected credit loss has been recognised becomes uncollectible in a subsequent period, it is written off against the provision.

ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).

For trade receivables and contract assets, the Group applies a simplified approach in calculating ECLs. Therefore, the Group does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each reporting date.

The Group has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment.

16 Cash and cash equivalents as at 30 June 2022 includes $8,938.9m in debt and equity proceeds received for the acquisition of Vifor (Note 2).

17 The carrying amount disclosed above is a reasonable approximation of fair value. The maximum exposure to credit risk at the reporting date is the carrying amount of each class of receivable disclosed above. Refer to Note 11 for more information on the risk management policy of the Group and the credit quality of trade receivables.

Notes to the Financial Statements

Note 15: Receivables, Contract Assets and Payables continued

Contract assets and deferred revenue (contract liabilities): The completion of performance obligations often differs from contract payment schedules. A contract asset is initially recognised for revenue earned from satisfying a performance obligation; however, the receipt of consideration is conditional upon the full satisfaction of the performance obligation within the contract. Upon completing the full performance obligation, the amount recognised as contract assets is reclassified to trade receivables. Amounts billed in accordance with customer contracts, but where the Group had not yet provided a good or service, are recorded and presented as part of deferred revenue. Deferred revenue is recognised as revenue when the Group performs under the contract.

Other current receivables are recognised and carried at the nominal amount due upon an unconditional right to payment. Non-current receivables are recognised and carried at amortised cost. They are non-interest bearing and have various repayment terms.

As at 30 June 2022, the Group had a provision for expected credit losses of $16.9m (2021: $23.5m).

	2022	2021
	US$m	US$m
Opening balance as at 1 July	23.5	25.3
Allowance utilised/written back	(5.6)	(2.3)
Currency translation differences	(1.0)	0.5
Closing balance at 30 June	16.9	23.5

Non-trade receivables do not include any impaired or overdue amounts and it is expected they will be received when due. The Group does not hold any collateral in respect to other receivable balances.

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Key Judgements and Estimates

In applying the Group’s accounting policy to trade and other receivables with governments and related entities in South Eastern Europe as set out in Note 11, significant judgement is involved in assessing the expected credit loss of trade or other receivable amounts. Matters considered include recent trading experience, current economic and political conditions and the likelihood of continuing support from agencies such as the European Central Bank.

(b) Trade and other payables

(b) Trade and other payables
	2022	2021
	US$m	US$m
Current
Trade payables	591.8	523.0
Accruals and other payables	1,709.4	1,566.4
Carrying amount of current trade and other payables	2,301.2	2,089.4
Non-current
Accruals and other payables	267.1	139.5
Contingent consideration associated with business combinations	268.6	345.8
Carrying amount of other non-current liabilities	535.7	485.3

Trade payables, accruals and other payables: Represents the notional amounts owed to suppliers for goods and services provided to the Group prior to the end of the financial year that are unpaid. Trade and other payables are non-interest bearing and have various repayment terms but are usually paid within 30 to 60 days of recognition.

Receivables and payables include the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, taxation authorities is included in other receivables or payables in the balance sheet.

Contingent consideration associated with business combinations: The Group recognised contingent consideration associated with the past business combinations for Vitaeris and Calimmune as non-current financial liabilities at fair value, which is then remeasured at each subsequent reporting date at fair value through profit and loss.

The fair value estimations typically depend on factors such as technical milestones or market performance, and are adjusted for the probability of their likelihood of potential future payments, and are appropriately discounted to reflect the impact of time. Refer to Note 11 for further details on the fair value measurement. As at 30 June 2022, the maximum amount of undiscounted potential future milestone payments relating to historical business combinations are $470.0m (2021: $795.0m), of which $268.6m (2021: $345.8m) is reflected as a contingent consideration liability at fair value. The reduction in the undiscounted potential future milestone payments and contingent consideration liability at fair value is largely due to the impairment of certain intellectual property assets associated with the Calimmune acquisition (Note 8).

Changes in the fair value of contingent consideration liabilities in subsequent periods are recognised in research and development expenses for early-stage products and as cost of sales for currently marketed products. The effect of unwinding the discount over time for contingent consideration carried at fair value is recognised as finance costs.

Notes to the Financial Statements Note 16: Provisions

Note 16: Provisions
	Employee benefits Other Total
	US$m US$m US$m US$m US$m US$m
	2022 2021 2022 2021 2022 2021
Current Carrying amount at the start of the year Utilised Additions Currency translation differences	211.7 156.1 15.7 0.8 227.4 156.9 (58.8) (47.2) (14.6) (0.2) (73.4) (47.4) 30.5 97.2 9.3 15.5 39.8 112.7 (11.7) 5.6 (0.6) (0.4) (12.3) 5.2
	(11.7) 5.6
Carrying amount at the end of the year	171.7 211.7	9.8 15.7 181.5 227.4
Non-current Carrying amount at the start of the year Utilised Additions Reclassification from accruals Currency translation differences	47.9 41.7 59.9 — 107.8 41.7 (5.7) (2.9) — — (5.7) (2.9) 2.6 8.2 4.6 34.6 7.2 42.8 — — — 25.0 — 25.0 (3.6) 0.9 (4.0) 0.3 (7.6) 1.2
Carrying amount at the end of the year	41.2 47.9	60.5 59.9 101.7 107.8

Provisions are recognised when all three of the following conditions are met:

The Group has a present or constructive obligation arising from a past transaction or event
It is probable that an outflow of resources will be required to settle the obligation
A reliable estimate can be made of the obligation.

Provisions are not recognised for future operating losses. Provisions recognised reflect our best estimate of the expenditure required to settle the present obligation at the reporting date. Where the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows to settle the obligation at a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the obligation. Other provisions includes the provision for asset retirement obligations and onerous contracts. Detailed information about employee benefits is presented in Note 6.

Notes to the Financial Statements Other Notes

Note 17: Related Party Transactions

Ultimate controlling entity and subsidiaries

The ultimate controlling entity is CSL Limited, otherwise described as the parent company. The following table lists the Group’s material subsidiaries.

Company
Country of Incorporation

Percentage owned (%)

2022
2021

CSL Limited
Australia
Subsidiaries of CSL Limited:
CSL Innovation Pty Ltd
Australia
CSL Behring (Australia) Pty Ltd
Australia
CSL Behring LLC
USA
CSL Plasma Inc
USA
CSL Behring GmbH
Germany
CSL Behring AG
Switzerland
CSL Behring Lengnau AG
Switzerland
CSLB Holdings Inc
US
CSL Finance Plc
UK
CSL Finance Pty Ltd
Australia
Seqirus Pty Ltd
Australia
Seqirus UK Limited
UK
Seqirus Vaccines Limited
UK
Seqirus USA Inc
USA
Seqirus Inc
USA

100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100

Related party transactions

All transactions with subsidiaries have been eliminated on consolidation.

Note 18: Detailed Information - People Costs

( a) Defined benefit plans

The Group sponsors a range of defined benefit pension plans that provide either a lump sum or ongoing pension benefit for its worldwide employees upon retirement. Entities of the Group who operate defined benefit plans contribute to the respective plans in accordance with the Trust Deeds, following the receipt of actuarial advice. The surplus/deficit for each defined benefit plan operated by the Group is as follows:

Pension Plan	June 2022 June 2021 US$m US$m
	Plan Assets Accrued benefit Plan surplus / (deficit) Plan Assets Accrued benefit Plan surplus / (deficit)
CSL Pension Plan (Australia) – provides a lump sum benefit upon exit CSL Behring AG Pension Plan (Switzerland) – provides an ongoing pension18 CSL Behring Union Pension Plan (USA) – provides an ongoing pension CSL Behring GmbH Supplementary Pension Plan (Germany) – provides an ongoing pension CSL Behring Innovation GmbH Supplementary Pension Plan (Germany) – provides an ongoing pension bioCSL GmbH Pension Plan (Germany) – provides an ongoing pension CSL Behring KG Pension Plan (Germany) – provides an ongoing pension CSL Plasma GmbH Pension Plan (Germany) – provides an ongoing pension CSL Behring KK Retirement Allowance Plan (Japan) – provides a lump sum benefit upon exit CSL Behring S.A. Pension Plan (France) – provides a lump sum benefit upon exit CSL Behring S.p.A Pension Plan (Italy) – provides a lump sum benefit upon exit	15.8 (13.5) 2.3 19.0 (18.6) 0.4 620.4 (620.4) — 755.7 (760.1) (4.4) 45.3 (42.2) 3.1 66.8 (63.3) 3.5 — (138.0) (138.0) — (207.2) (207.2) — (22.6) (22.6) — (34.1) (34.1) — (2.5) (2.5) — (3.2) (3.2) — (12.0) (12.0) — (19.0) (19.0) — (0.4) (0.4) — (0.4) (0.4) — (11.4) (11.4) — (15.3) (15.3) — (1.4) (1.4) — (1.9) (1.9) — (0.7) (0.7) — (0.9) (0.9)
Total	681.5 (865.1) (183.6) 841.5 (1,124.0) (282.5)

18 The CSL Behring AG Pension Plan (Switzerland) has a surplus of $75.6m that is not recognised, on the basis that future economic benefits are not available to the entity in the form of a reduction in future contributions or a cash refund. The plan assets have been recognised up to the asset ceiling limit.

Notes to the Financial Statements

Note 18: Detailed Information - People Costs continued

In addition to the plans listed, CSL Behring GmbH, CSL Behring Innovation GmbH and Seqirus GmbH employees are members of multi-employer plans administered by an unrelated third party. CSL Behring GmbH, CSL Behring Innovation GmbH, Seqirus GmbH and their employees make contributions to the plans and receive pension entitlements on retirement. Participating employers may have to make additional contributions in the event that the plans have insufficient assets to meet their obligations. However, there is insufficient information available to determine this amount on an employer by employer basis. The contributions made by CSL Behring GmbH, CSL Behring Innovation GmbH and Seqirus GmbH are determined by the Plan Actuary and are designed to be sufficient to meet the obligations of the plans based on actuarial assumptions. Contributions made by CSL Behring GmbH, CSL Behring Innovation GmbH and Seqirus GmbH are expensed in the year in which they are made.

Movements in accrued benefits and assets

During the financial year the value of accrued benefits decreased by $258.9m, mainly attributable to:

Benefits paid by the plans of $91.9m;
Actuarial adjustments, due primarily to changes in assumptions at the end of the year than originally anticipated by the actuary, generating a decrease in accrued benefits of $162.9m. These adjustments do not affect the profit and loss as they are recorded in other comprehensive income;
Favourable foreign currency movements of $63.0m which are taken directly to the Foreign Currency Translation Reserve;
Offsetting these movements were increases from:
Service cost charged to the profit and loss of $42.9m, representing the increased benefit entitlement of members, arising from an additional year of service and salary increases;
Interest costs of $7.2m, representing the discount rate on benefit obligation and anticipated monthly benefit payments; and
Contributions made by employees of $13.4m.

Plan assets decreased by $160m during the financial year. The decrease is mainly attributable to the following factors:

Benefits paid by the plans of $87.2m;
Actuarial adjustments due primarily to changes in assumptions at the end of the year than originally anticipated by the actuary and experience adjustments, generating a decrease in plan assets of $5.0m;
Changes in the asset ceiling[18] resulting in the derecognition of plan assets of $75.6m;
Unfavourable foreign currency movements of $37.0m which are taken directly to the Foreign Currency Translation Reserve; and
Offsetting these movements were increases from contributions made by employer and employee that increased plan assets by $40.4m and investment returns increased plan assets by $4.3m.

plan assets by $40.4m and investment returns increased plan assets by $4.3m.
	2022	2021
The major categories of totalplan assets are as follows:	US$m	US$m
Cash	24.1	63.0
Instruments quoted in active markets:
Equity instruments	225.8	313.0
Bonds	224.0	290.6
Unquoted investments - property	177.7	169.7
Other assets	29.9	5.2
Total Plan Assets	681.5	841.5
	2022	2021
Theprincipal actuarial assumptions, expressed as weighted averages, at the reporting dates are:	%	%
Discount rate	2.0%	0.7%
Future salary increases	2.2%	2.1%
Future pension increases	0.4%	0.5%

The variable with the most significant impact on the defined benefit obligation is the discount rate applied in the calculation of accrued benefits. A decrease in the average discount rate applied to the calculation of accrued benefits of 0.25% would increase the defined benefit obligation by $27.6m. An increase in the average discount rate of 0.25% would reduce the defined benefit obligation by $25.8m.

The defined benefit obligation will be discharged over an extended period as members exit the plans. The plan actuaries have estimated that the following payments will be required to satisfy the obligation. The actual payments will depend on the pattern of employee exits from the Group’s plans.

Within one year $48.3m (2021: $50.9m) Between two and five years $175.0m (2021: $185.0m) Between five and ten years $83.8m (2021: $215.6m) Beyond ten years $558.2m (2021: $672.4m)

Notes to the Financial Statements Note 18: Detailed Information - People Costs continued

(b) Share-based payments

Long Term Incentives

A face value equity allocation methodology, being a volume weighted average share price based on the market price of a CSL share at the time of grant, is used to determine the number of units granted to a participant under each of the shared based payment plans, which are as follows:

The Executive Performance and Alignment Plan ("EPA") grants Performance Share Units ("PSU") to qualifying executives. Vesting is subject to continuing employment, satisfactory performance and the achievement of absolute return measures. The return measures include EPS growth and a seven-year rolling average Return on Invested Capital ("ROIC").
The Retain and Grow Plan ("RGP") grants Restricted Share Units ("RSU") to qualifying employees, participation in the RGP plan is broader than in the EPA plan. Vesting is subject to continuing employment and satisfactory performance.

EPA and RGP grants made prior to 1 September 2021 will vest in equal tranches on the first, second, third and fourth anniversaries of the grant. EPA grants made from 1 September 2021 will vest on the third anniversary. RGP grants made from 1 September 2021 will vest in equal tranches on the first, second and third anniversaries of the grant. For RGP commencement benefit awards, vesting dates will vary.

There have been no changes to the terms of grant of any existing instruments.

The fair value of the awards granted is estimated at the date of grant using an adjusted form of the BlackScholes model, considering the terms and conditions upon which the PSUs and RSUs were granted. There is no exercise price payable on PSUs and RSUs.

The following grants were issued during the year ended 30 June 2022:

Date of grant	PSUs	RSUs
1 September 2021	183,972	512,003
1 March 2022	—	27,107

The relevant tranche of PSUs will exercise upon vesting on 1 September 2024. The relevant tranche of RSUs will exercise upon vesting between September 2021 and March 2025.

The Non-Executive Directors Plan

The Non-Executive Directors ("NED") pay a minimum of 20% of their pre-tax base fee in return for a grant of Rights, each Right entitling a NED to acquire one CSL share at no cost (shares purchased on market). There is a nominated restriction period, of three to fifteen years, after which the NED will have access to their shares.

On 26 August 2021 and 4 October 2021, 2,449 Rights were granted under the NED vesting on 21 February 2022 and 22 August 2022.

Global Employee Share Plan

The Global Employee Share Plan ("GESP") allows employees to make contributions from after tax salary up to a maximum of A$6,000 per six month contribution period. The employees receive the shares at a 15% discount to the applicable market rate, as quoted on the ASX on the first day or the last day of the six-month contribution period, whichever is lower.

Recognition and measurement

The fair value of awards granted are recognised as employee benefit expense with a corresponding increase in equity. Fair value is independently measured at grant date and recognised over the period during which the employees become unconditionally entitled to the award.

Fair value is independently determined using a combination of the Binomial and Black-Scholes valuation methodologies, including Monte Carlo simulation, considering the terms and conditions on which the awards were granted. The fair value of the awards granted excludes the impact of any nonmarket vesting conditions, which are included in assumptions about the number of awards that are expected to vest.

At each reporting date, the number of awards that are expected to vest is revised. The employee benefit expense recognised each period considers the most recent estimate of the number of awards that are expected to vest. No expense is recognised for awards that do not ultimately vest, except where the vesting is conditional upon a market condition and that market condition is not met. The Group does not have any awards with a market condition as at 30 June 2022.

Notes to the Financial Statements

Note 18: Detailed Information - People Costs continued

Valuation assumptions and fair values of equity instruments granted

The model inputs for share-based payments granted during the year ended 30 June 2022 included:

	Fair Value	Share Price	Exercise	Expected	Life	Expected	Risk-free
	(A$)	(A$)	Price (A$)	Volatility19	Assumption	Dividend Yield	Interest Rates
Performance Share Units (by grant date)20
1 September 2021 - Tranche 1	$302.44	$310.84	Nil	29.32 %	36 months	0.91 %	0.01 %
Restricted Share Units (by grant date)
1 September 2021 - Tranche 1	$310.84	$310.84	Nil	N/A	0 months	N/A	N/A
1 September 2021 - Tranche 2	$309.44	$310.84	Nil	18.82 %	6 months	0.91 %	0.01 %
1 September 2021 - Tranche 3	$308.02	$310.84	Nil	21.57 %	12 months	0.91 %	0.01 %
1 September 2021 - Tranche 4	$306.63	$310.84	Nil	34.29 %	18 months	0.91 %	0.01 %
1 September 2021 - Tranche 5	$305.22	$310.84	Nil	31.48 %	24 months	0.91 %	0.01 %
1 September 2021 - Tranche 6	$303.84	$310.84	Nil	29.72 %	30 months	0.91 %	0.10 %
1 September 2021 - Tranche 7	$302.44	$310.84	Nil	29.32 %	36 months	0.91 %	0.19 %
1 September 2021 - Tranche 8	$299.70	$310.84	Nil	26.96 %	48 months	0.91 %	0.42 %
1 March 2022 - Tranche 1	$263.92	$263.92	Nil	N/A	0 months	N/A	N/A
1 March 2022 - Tranche 2	$262.44	$263.92	Nil	28.27 %	6 months	1.11 %	1.02 %
1 March 2022 - Tranche 3	$261.00	$263.92	Nil	24.25 %	12 months	1.11 %	1.02 %
1 March 2022 - Tranche 4	$259.54	$263.92	Nil	24.08 %	18 months	1.11 %	1.02 %
1 March 2022 - Tranche 5	$258.10	$263.92	Nil	32.99 %	24 months	1.11 %	1.02 %
1 March 2022 - Tranche 6	$256.65	$263.92	Nil	30.94 %	30 months	1.11 %	1.26 %
1 March 2022 - Tranche 7	$255.24	$263.92	Nil	29.54 %	36 months	1.11 %	1.50 %
1 March 2022 - Tranche 8	$253.81	$263.92	Nil	29.19 %	42 months	1.11 %	1.59 %
Rights (by grant date)
26 August 2021 - Tranche 1	$304.00	$305.37	Nil	19.27 %	6 months	0.91 %	0.02 %
26 August 2021 - Tranche 2	$302.62	$305.37	Nil	21.69 %	12 months	0.91 %	0.02 %
4 October 2021 - Tranche 1	$292.17	$293.32	Nil	19.32 %	5 months	1.02 %	0.05 %
4 October 2021 - Tranche 2	$290.69	$293.32	Nil	21.24 %	11 months	1.02 %	0.05 %
GESP (by grant date)21
3 September 2021 - Tranche 1	$76.72	$303.87	$227.15	18.82 %	6 months	0.91 %	0.01 %
4 March 2022 - Tranche 1	$33.97	$258.30	$224.33	28.27 %	6 months	1.11 %	1.02 %

Note 19: Detailed Information - Shareholder Returns

Note 19: Detailed Information - Shareholder Returns
	Consolidated Entity
	2022 2021 US$m US$m
Retained earnings Opening balance Net profit for the year Dividends Actuarial gain on defined benefit plans Deferred tax expense on actuarial gain/loss on defined benefit plans	12,252.7 10,752.3 2,254.7 2,375.0 (1,038.7) (958.0) 40.2 100.6 (5.5) (17.2)
Closing balance	13,503.4 12,252.7

19 Expected volatility is based on historical volatility (based on the remaining life assumption of each equity instrument, adjusted for expected changes). 20 PSUs are subject to an EPS growth and ROIC performance measure.

21 Fair value of GESP shares is estimated based on the assumptions prevailing on the grant date. In accordance with the terms and conditions of the GESP plan, shares are issued at a 15% discount to the lower of the ASX market price on the first and last dates of the contribution period.

Notes to the Financial Statements

Note 20: Auditor Remuneration

During the year, the following fees were paid or were payable for services provided by CSL’s auditor and by the auditor’s related practices:

auditor’s related practices:
	2022	2021
AUDIT SERVICES – Ernst & Young Australia	US$	US$
Fees for auditing the statutory financial report of the parent covering the group and auditing
the statutory financial reports of any controlled entities	2,402,268	1,956,994
Fees for other assurance and agreed-upon-procedures services under other legislation or
contractual arrangements where there is discretion as to whether the service is provided by
the auditor or another firm
– Assurance services over the 144a bond issuance	326,152	—
– Sustainability assurance	106,873	66,819
– Agreed-upon procedures and other audit engagements	146,124	90,045
Fees for other services
Training	39,000	80,000
Due diligence	150,295	211,449
Remuneration advisory	190,832	357,646
Total fees to Ernst & Young (Australia)	3,361,544	2,762,953
AUDIT SERVICES – Ernst & Young Overseas Member Firms
Fees for auditing the statutory financial report of the parent covering the group and auditing
the statutory financial reports of any controlled entities	3,678,633	3,556,179
Fees for assurance services that are required by legislation to be provided by the auditor	2,721	13,845
Fees for other assurance and agreed-upon-procedures services under other legislation or
contractual arrangements where there is discretion as to whether the service is provided by
the auditor or another firm
– Agreed-upon procedures and other audit engagements	147,474	77,009
Fees for other services	35,127	35,224
Total fees to overseas member firms of Ernst & Young (Australia)	3,863,955	3,682,257

Total audit and other assurance services	6,810,245	5,760,891
Total non-audit services	415,254	684,319
Total auditor’s remuneration	7,225,499	6,445,210

Notes to the Financial Statements

Note 21: Deed of Cross Guarantee

A deed of cross guarantee was executed between CSL Limited and some of its wholly-owned entities, namely CSL Behring (Holdings) Pty Ltd, CSL Finance Pty Ltd, Seqirus (Australia) Pty Ltd, CSL Innovation Pty Ltd, Seqirus Pty Ltd, CSL Behring (Australia) Pty Ltd, Seqirus Holdings Australia Pty Ltd, CSL IP Investments Pty Ltd and Amrad Pty Ltd (deregistered subsequent to 30 June 2022). Under this deed, each company guarantees the debts of the others. By entering into the deed, these specific wholly-owned entities have been relieved from the requirement to prepare a financial report and directors’ report under Class Order 2016/785 (as amended) issued by the Australian Securities and Investments Commission.

The entities that are parties to the deed represent a ‘Closed Group’ for the purposes of the Class Order, and as there are no other parties to the deed of cross guarantee that are controlled by CSL Limited, they also represent the ‘Extended Closed Group’. A consolidated income statement and a summary of movements in consolidated retained profits for the year ended 30 June 2022 and 30 June 2021 and a consolidated balance sheet as at each date for the Closed Group is set out below.

Closed Group is set out below.
Income Statement	Consolidated Closed Group
	2022 2021 US$m US$m
Sales revenue Cost of sales	1,180.7 1,244.4 (800.6) (652.0)
Gross profit Dividend income Interest income Research and development expenses Selling and marketing expenses General and administration expenses Finance costs Sundry expenses	380.1 592.4
	1,371.9 667.3
	9.0 2.2 (157.1) (139.4) (64.1) (60.2) (54.7) (110.7) (44.7) (32.9)
	(94.0) (116.8)
Profit before income tax expense Income tax expense	1,346.4 801.9 (28.7) (51.8)
Profit for the year	1,317.7 750.1

Notes to the Financial Statements Note 21: Deed of Cross Guarantee continued

Note 21: Deed of Cross Guaranteecontinued
Balance Sheet	Consolidated Closed Group
	2022 US$m	2021 US$m
CURRENT ASSETS	2,292.4 561.3 232.1
Cash and cash equivalents		334.7
Receivables and contract assets		584.5
Inventories		267.4
Total Current Assets	3,085.8	1,186.6
NON-CURRENT ASSETS
Other receivables	3,020.7	39.6
Other financial assets	14,641.8 1,333.5 84.7 20.0 2.3	14,644.2
Property, plant and equipment		1,230.5
Deferred tax assets		77.0
Intangible assets		25.3
Retirement benefit assets		0.4
Total Non-Current assets	19,103.0	16,017.0
TOTAL ASSETS	22,188.8	17,203.6
CURRENT LIABILITIES
Trade and other payables	1,344.2 67.2	1,087.0
Provisions		69.1
Interest-bearing liabilities and borrowings	157.9	—
Other current liabilities	3.9	49.9
Total Current Liabilities	1,573.2	1,206.0
NON-CURRENT LIABILITIES
Trade and other payables	403.7	112.9
Interest-bearing liabilities and borrowings	1,330.9 44.2 23.6	1,509.3
Provisions		46.9
Other non-current liabilities		26.1
Total Non-Current Liabilities	1,802.4	1,695.2
TOTAL LIABILITIES	3,375.6	2,901.2
NET ASSETS	18,813.2	14,302.4
EQUITY	483.8 4.9 18,324.5
Contributed equity		(3,476.6)
Reserves		(268.7)
Retained earnings		18,047.7
TOTAL EQUITY	18,813.2	14,302.4
Summary of movements in retained earnings of the Consolidated Closed Group		2021 US$m
	2022
	US$m
Retained earnings at beginning of the financial year Net profit Actuarial losses on defined benefit plans, net of tax Dividends paid	18,047.7 18,258.4 1,317.7 750.1 (2.2) (2.8) (1,038.7) (958.0)
Retained earnings at the end of the financial year	18,324.5 18,047.7

Notes to the Financial Statements Note 22: Parent Entity Information

Information relating to CSL Limited ("the parent entity")

(a) Summary financial information

Note 22: Parent Entity Information Information relating to CSL Limited ("the parent entity") (a) Summary financial information
	2022	2021
	US$m	US$m
The individual financial statements for the parent entity show the following aggregate amounts:
Current assets	350.7	373.6
Total assets	7,088.0	6,333.1
Current liabilities	314.2	342.5
Total liabilities	336.6	4,038.3
Contributed equity	483.8	(4,504.6)
Foreign currency translation reserve	(55.0)	(55.0)
Retained earnings	6,322.6	6,854.4
Net assets/ Total equity	6,751.4	2,294.8
Profit for theyear	506.8	106.1
Total comprehensive income	506.8	106.1

(b) Guarantees entered into by the parent entity

The parent entity provides certain financial guarantees in the ordinary course of business. No liability has been recognised in relation to these guarantees as the fair value of the guarantees is immaterial. These guarantees are mainly related to all external debt facilities of the Group. In addition, the parent entity provides letters of comfort to indicate support for certain controlled entities to the amount necessary to enable those entities to meet their obligations as and when they fall due, subject to certain conditions (including that the entity remains a controlled entity).

(c) Contingent liabilities of the parent entity

The parent entity did not have any material contingent liabilities as at 30 June 2022 or 30 June 2021. For information about guarantees given by the parent entity, please refer above and to Note 21.

(d) Contractual commitments for the acquisition of property, plant and equipment

The parent entity did not have any material contractual commitments for the acquisition of property, plant and equipment as at 30 June 2022 or 30 June 2021.

Note 23: Subsequent Events

Other than the impact of the acquisition of Vifor (Note 2 and Note 11), there are no other matters or circumstances which have arisen since the end of the financial year which have significantly affected or may significantly affect the operations of the Group, results of those operations or the state of affairs of the Group in subsequent financial years.

Note 24: Amendments to Accounting Standards and Interpretations

(a) Amendments to accounting standards and interpretations adopted by the Group

The Group has adopted the following amendment to the accounting standards. This change did not have a material impact on the Group’s accounting policies nor did it require any restatement.

AASB 2020-8 Amendments to Australian Accounting Standards – Interest Rate Benchmark Reform – Phase 2

(b) Amendments to accounting standards and interpretations not yet effective for the Group

A number of other accounting standards and interpretations have been issued and will be applicable in future periods. While these remain subject to ongoing assessment, no significant impacts have been identified to date. These standards have not been applied in the preparation of these Financial Statements.

Applicable to the Group for the year ending 30 June 2023:

AASB 2020-3 Amendments to Australian Accounting Standards – Annual Improvements 2018-2020 and Other Amendments
Reference to the Conceptual Framework – Amendments to AASB 3 Business Combinations
Property, Plant and Equipment — Proceeds before Intended Use
Onerous Contracts — Cost of Fulfilling a Contract

Applicable to the Group for the year ending 30 June 2024:

AASB 2020-1 and AASB 2020-6 Amendments to Australian Accounting Standards – Classification of Liabilities as Current or Non-current
Classification of Liabilities as Current or Non-current - Amendments to AASB 101 Presentation of Financial Statements
AASB 2021-2 Amendments to Australian Accounting Standards – Disclosure of Accounting Policies and Definition of Accounting Estimates
AASB 2021-5 Amendments to Australian Accounting Standards – Deferred Tax related to Assets and Liabilities arising from a Single Transaction

Directors’ Declaration

1) In the opinion of the Directors:
a) the financial statements and notes of the company and of the Group are in accordance with the Corporations Act 2001 (Cth), including:
- i. giving a true and fair view of the company’s and Group’s financial position as at 30 June 202 2 and of their performance for the year ended on that date; and
- ii. complying with Australian Accounting Standards and Corporations Regulations 2001.
b) there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.
2) About this Report (a) in the notes to the financial statements confirms that the financial report complies with International Financial Reporting Standards as issued by the International Accounting Standards Board.
3) This declaration has been made after receiving the declarations required to be made to the directors in accordance with section 295A of the Corporations Act 2001 (Cth) for the financial period ended 30 June 202 2 .
4) In the opinion of the Directors, as at the date of this declaration, there are reasonable grounds to believe that the members of the Closed Group identified in Note 21 will be able to meet any obligations or liabilities to which they are or may become subject, by virtue of the Deed of Cross Guarantee dated 3 February 2017.

This declaration is made in accordance with a resolution of the directors.

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Brian McNamee AO Chairman

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Paul Perreault Managing Director

Melbourne

August 1 6 August 202 2

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Ernst & Young Tel: +61 3 9288 8000 8 Exhibition Street Fax: +61 3 8650 7777 Melbourne VIC 3000 Australia ey.com/au GPO Box 67 Melbourne VIC 3001

Independent Auditor's Report to the Members of CSL Limited

Report on the Audit of the Financial Report

Opinion

We have audited the financial report of CSL Limited (the Company) and its subsidiaries (collectively the Group), which comprises the consolidated balance sheet as at 30 June 2022, the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, notes to the financial statements, including a summary of significant accounting policies, and the directors' declaration.

In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001 , including:

a) giving a true and fair view of the consolidated financial position of the Group as at 30 June 2022 and of its consolidated financial performance for the year ended on that date; and
b) complying with Australian Accounting Standards and the Corporations Regulations 2001 .

Basis for Opinion

We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current year. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context.

We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the Financial Repor t section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial report. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying financial report.

A member firm of Ernst & Young Global Limited

Liability limited by a scheme approved under Professional Standards Legislation

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1. Existence and valuation of inventories

Why significant

At 30 June 2022, the Group holds inventories of $4,333.0 million which are recorded at the lower of cost and net realisable value. The Group’s accounting for inventories is complex due to the nature of products being manufactured requiring multiple inputs into the cost which leads to a risk that gross inventories may be incorrectly valued.

Provisions can be recognised for all components of inventories, including raw materials, work in progress and finished goods. The Group considers a number of factors when determining the appropriate level of inventory provisioning, including regulatory approvals and future demand for the Group’s products.

In addition, the geographic footprint of the Group and the movements and sale of inventory between the Group’s operations means both the existence of inventories and the valuation of inventories is a key audit matter. This includes considering whether any mark up of inventories from sales within the Group is appropriately eliminated in the consolidated financial statements.

The Group’s disclosures with respect to inventories is included in Note � of the financial report.

How our audit addressed the key audit matter

We have assessed the carrying value of inventories, including the determination of cost and provisions for obsolescence and those that ensure inventory is carried at the lower of cost and net realisable value at 30 June 2022.

The existence of inventories has been addressed through our assessment of the internal controls which included attendance at periodic cycle counts or through attendance at year-end inventory stocktakes in locations with significant stock holdings. We remained alert for obsolescence issues during our observation of physical inventories.

We assessed the appropriateness of the determination of inventory cost by assessing the accuracy of the standard cost approach used by the Group and assessing the recognition of variances from standard costs.

We assessed whether inventory is recognised at the lower of cost or net realisable value at period end by comparing the inventory value measured at cost to evidence supporting net realisable value such as the current selling price of the products and achieved margins.

We assessed whether the provisions for obsolescence calculated by the Group reflect known quality issues and commercial considerations including product expiration, market demand, and manufacturing plans, as well as their compliance with Australian Accounting Standards.

We assessed the elimination of any unrealised profits on transactions between group entities and resultant tax consequences by the Group.

We have assessed the Group’s disclosures with respect to inventories in Note � of the financial report.

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

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Information Other than the Financial Report and Auditor’s Report Thereon

The directors are responsible for the other information. The other information comprises the information included in the Company’s 2022 Annual Report other than the financial report and our auditor’s report thereon. We obtained the Directors’ Report that is to be included in the Annual Report, prior to the date of this auditor’s report, and we expect to obtain the remaining sections of the Annual Report after the date of this auditor’s report.

Our opinion on the financial report does not cover the other information and we do not and will not express any form of assurance conclusion thereon, with the exception of the Remuneration Report and our related assurance opinion.

In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed on the other information obtained prior to the date of this auditor’s report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors for the Financial Report

The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

In preparing the financial report, the directors are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

Auditor's Responsibilities for the Audit of the Financial Report

Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report.

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

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As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial report. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.

We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied.

From the matters communicated to the directors, we determine those matters that were of most significance in the audit of the financial report of the current year and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

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Report on the Audit of the Remuneration Report

Opinion on the Remuneration Report

We have audited the Remuneration Report included in the directors' report for the year ended 30 June 2022.

In our opinion, the Remuneration Report of CSL Limited for the year ended 30 June 2022, complies with section 300A of the Corporations Act 2001.

Responsibilities

The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001 . Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.

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Ernst & Young

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Kylie Bodenham Partner Melbourne 16 August 2022

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

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CSL Ltd. — Annual Report 2022

17854_rns_2022-08-16_564795cf-032f-406a-93a6-5c80a8d643a9.pdf

For immediate release

RESULTS ANNOUNCEMENT FOR THE FULL YEAR ENDED 30 JUNE 2022

For further information, please contact:

Investor Relations:

Media:

Contents

Legal notice

Forward-looking statements

CSL Limited

Appendix 4E

Year Ended 30 June 2022

Results for Announcement to the Market

Reported

Underlying Net Profit after Tax at Constant Currency[1]

Dividends

Record date for determining entitlements to the Final dividend: 7 September 2022

Explanation of results

Other information required by Listing Rule 4.3A

Net Tangible Assets Backing

Changes in controlled entities

Acquisition of Vifor

Audit report

Chair Message

Poised for Growth

Our Governance Priorities

An Opportune Time

Outlook

CEO Message

Dear Shareholders,

Culture is Key

Executing on Our 2030 Strategy

Investment and Innovation

A Promising Future

Acquisition of Vifor Pharma

CSL’s 2030 Strategy (with Vifor)

Our Company

CSL at a Glance

Our Businesses

CSL Behring

CSL Seqirus

Our R&D Pipeline

Our research and development pipeline

Global Research and Development Pipeline 2021/2022

Our Product Portfolio

CSL Behring

Immunology

Haematology

Cardiovascular and metabolic

Respiratory

Transplant

CSL Seqirus

Influenza Vaccines

Products of National Significance

In-licensed Vaccines and Pharmaceuticals

Our Operating Review

CSL Behring

Plasma collections

CSL Seqirus

Financial Highlights & Reported Results

Expense performance

Financial position

What we depend on

Unmet need

Natural resources

Physical assets

Our people

Financial resources

Collaborators and business partners

Value we create

A healthier more productive society

Our Strategy and Performance

Driving Sustainable Growth of Our Core Platforms

Disruptive R&D Innovation to Better Meet the Needs of Patients and Public Health

Our Digital Transformation

Advancing Promising Futures for Our People

Our Sustainability Strategy

Sustainability Framework

CSL Ltd. Annual Report 2022