Prudential plc — Governance Information 2025

Jan 2, 2025

PRUDENTIAL

Prudential plc

Terms of Reference: Remuneration Committee

1. Constitution and Purpose

a. The Committee is constituted by the Board of Directors to assist the Board in meeting its responsibilities regarding the determination, implementation and operation of the overall remuneration policy for the Group, including the remuneration of the Chair of the Board and the Executive Directors, as well as overseeing the remuneration arrangements of other staff within its purview.

b. The Committee will, where appropriate, consult with the Chair of the Board and the Chief Executive Officer.

2. Membership

a. The Committee shall comprise at least three members, all of whom shall be independent non-executive directors.

b. Appointments to the Committee are made by the Board on the recommendation of the Nomination & Governance Committee and in consultation with the Chair of the Remuneration Committee.

c. The Board shall appoint the Committee Chair who shall be an independent non-executive director who must have served on a remuneration committee for at least twelve months.

d. The Chair of the Board shall not be chair of the Committee.

3. Secretary

The Company Secretary or their nominee shall act as the secretary of the Committee and will ensure that the Committee receives information and papers in a timely manner to enable full and proper consideration to be given to the business of the meeting.

4. Meetings

a. The Committee will meet at least three times a year and otherwise as required.

b. Meetings of the Committee shall be called by the secretary of the Committee at the request of the Committee Chair or any of its members. Committee members may convene additional meetings at any time to deal with matters within the remit of the Committee.

c. In the absence of the Committee Chair and/or an appointed deputy, the remaining members present shall elect one of themselves to chair the meeting who would qualify under these terms of reference to be appointed to that position by the Board.

Prudential plc
Page 1 of 7
Terms of reference – Remuneration Committee
Effective 1 January 2025
Approved by the Board on 3 December 2024

---

d. A quorum is two members of the Committee.

e. Only members of the Committee have the right to attend Committee meetings. However, the following individuals would be expected to attend meetings on a regular basis:

• the Chair of the Board;
• the Chief Executive Officer;
• the Chief Human Resources Officer; and
• the Director of Group Reward and Employee Relations & Chief HR Officer, UK.

f. Other individuals such as the Chief Risk and Compliance Officer and the Chief Financial Officer may be invited by the Committee Chair to attend for all or part of any meeting, as and when appropriate.

g. External advisers appointed by the Committee may also be invited to attend meetings to assist the Committee.

h. Unless otherwise agreed, reasonable notice of each meeting together with an agenda of items to be discussed and supporting papers shall be provided to each member of the Committee and any other attendee as required.

i. No individual should be involved in the consideration of their own remuneration.

5. Minutes

a. The secretary or their nominee shall minute the proceedings and decisions of all Committee meetings, and retain copies of the papers.

b. Minutes of Committee meetings shall be circulated to Committee members and, where appropriate, other meeting attendees, taking into account any conflicts of interest that may exist.

6. Engagement with shareholders

a. The Committee Chair shall attend the annual general meeting to answer shareholder questions on the Committee's activities.

b. The Committee Chair shall undertake appropriate discussions as necessary with institutional investors on the Directors' Remuneration Policy or any other aspects of Executive remuneration.

7. Duties

The Committee shall carry out the duties detailed below in respect of the Chair of the Board, Executive Directors, Group Executive Committee members, the Company Secretary and the Chief Internal Auditor, and for all employees captured by the Group Remuneration policy, as appropriate.

Prudential plc

Page 2 of 7

Terms of reference – Remuneration Committee

Effective 1 January 2025

Approved by the Board on 3 December 2024

---

i. Determining policy

The Committee shall:

a. recommend the Directors' Remuneration Policy, applicable to all Directors of the Board, for approval by shareholders. The Committee may not discuss, or pass resolutions in respect of the remuneration of, or the terms of any consultancy agreement with, any Non-executive Director of the Company other than the Chair of the Board. The remuneration of Non-executive Directors of the Company other than the Chair of the Board is a matter reserved for the Board as a whole. The Committee will, however, consider the share ownership guidelines for the Non-executive Directors as part of the regular monitoring of compliance with those guidelines.

b. approve the Group Remuneration Policy, applicable to all employees across the Group, and oversee its implementation for Group Remuneration Identified Staff¹,² within scope of applicable Group-wide remuneration regulation or guidance.

c. agree the policy for authorising claims for expenses from the Chief Executive Officer and the Chair of the Board.

d. review the ongoing appropriateness and relevance of remuneration policies within its purview.

When fulfilling these duties, the Committee shall:

e. design executive remuneration policies and practices to support strategy and promote long-term sustainable success, ensuring executive remuneration is aligned to Company purpose and values, clearly linked to the successful delivery of the Company's long-term strategy, and that the policies enable the use of independent judgement and discretion by the Committee to override formulaic outcomes. In doing so, the Committee shall satisfy itself that there is a formal and transparent procedure for establishing the Directors' Remuneration Policy, which is consistent with the Group's risk appetite and encourages strong risk management and solvency management practices. The objective of such policies shall be to attract, retain and motivate high calibre executive management without paying more than is necessary.

f. review workforce remuneration practices and related policies across the Group when setting the policy for executive director remuneration, as well as the alignment of incentives and awards with culture and the salaries paid by comparable companies for equivalent roles.

g. seek advice from the Risk Committee on risk management considerations to be applied to remuneration architecture, performance measures and the determination of pay-outs, to ensure risk management culture and conduct is appropriately reflected in the design and operation of executive remuneration.

h. seek advice (as required) from the Sustainability Committee on ESG and climate considerations in the design of remuneration architecture and performance measures.

¹ Group Remuneration Identified Staff refers to roles that the Committee has deemed are within the scope of the Company's Group Remuneration Policy with reference to the Hong Kong Insurance Authority Guideline on Group Supervision, namely the Company's directors, senior management, key persons in control functions and other employees whose actions may have a material impact on the risk exposure of the Group. As explained in the Annual Report and in these Terms of Reference, the Committee does not determine the remuneration of Non-Executive Directors of the Company other than the Chair of the Board.

² Senior management for the purpose of Hong Kong Listing Rules comprises the Group Executive Committee.

Prudential plc
Page 3 of 7
Terms of reference – Remuneration Committee
Effective 1 January 2025
Approved by the Board on 3 December 2024

---

ii. Implementing and overseeing policy

The Committee shall:

a. within the terms of the agreed and relevant policy and in consultation with the Chair of the Board and/or Chief Executive Officer, as appropriate, determine the total individual remuneration package of each executive director, the Chair of the Board, other members of the Group Executive Committee, the Company Secretary and the Chief Internal Auditor including bonuses, incentive payments and share options or other share awards. The choice of financial, non-financial and strategic measures is important, as is the exercise of independent judgement and discretion when determining remuneration awards, taking account of company performance, individual performance, and wider circumstances.

b. approve the share ownership guidelines and monitor compliance with those guidelines for the Board and Group Executive Committee members.

c. monitor the remuneration of and risk management implications of certain employees, in particular: (i) the Group Leadership Team in aggregate; (ii) Group Remuneration Identified Staff; (iii) those with a target opportunity to earn USD1.5m or more in a particular year; and (iv) those whose actual remuneration is USD1.5m or more in a particular year.

In respect of the Chair of the Board, the Committee shall:

d. determine the fee level and benefits annually or in line with the frequency set out in the relevant letter of appointment, obtain independent advice and data, and draw on internal expertise where appropriate to ensure that remuneration meets the objectives of the Directors' Remuneration Policy.

e. consider recommendations from the Senior Independent Director regarding the fees to be paid to the Chair of the Board.

In respect of the Executive Directors, the Committee shall:

f. review and approve individual packages for the Executive Directors at least annually, obtain independent advice and data, and draw on internal expertise where appropriate to ensure that remuneration meets the objectives of the Directors' Remuneration Policy.

g. approve the remuneration package to be offered to newly recruited Executive Directors, including determining the extent to which and the terms on which awards forfeited on leaving a previous employer will be replaced.

h. periodically review the terms of service agreements for Executive Directors to ensure that they remain fair and reasonable and are in the interests of the Company and shareholders.

i. review and approve the structure, terms and quantum of any severance arrangements for Executive Directors, ensuring that any such arrangements are in line with the Directors' Remuneration Policy and are otherwise fair and do not reward failure.

Prudential plc
Page 4 of 7
Terms of reference – Remuneration Committee
Effective 1 January 2025
Approved by the Board on 3 December 2024

---

In respect of the Group Executive Committee members (who are not Executive Directors), the Company Secretary and the Chief Internal Auditor, the Committee shall:

j. review and approve individual packages for the Group Executive Committee members, the Company Secretary and the Chief Internal Auditor at least annually, obtain independent advice and data, and draw on internal expertise where appropriate to ensure that remuneration meets the objectives of the Group Remuneration Policy.

k. approve the remuneration package to be offered to newly recruited Group Executive Committee members, a newly recruited Company Secretary or a newly recruited Chief Internal Auditor, including determining the extent to which and the terms on which awards forfeited on leaving a previous employer will be replaced.

l. periodically review the terms of service agreements for Group Executive Committee members to ensure that they remain fair and reasonable and are in the interests of the Company and shareholders.

m. review and approve the structure, terms and quantum of any severance arrangements for Group Executive Committee members, the Company Secretary and the Chief Internal Auditor, ensuring that any such arrangements are in line with the Group Remuneration Policy and are otherwise fair and do not reward failure.

n. consider feedback provided by the Audit Committee Chair on the Chief Financial Officer's performance.

o. consider feedback by the Risk Committee Chair on the Chief Risk and Compliance Officer's performance.

The Committee shall also have the duties set out above for members of the Group Executive Committee in respect of any former Executive Directors who are employed by the Group (who are not Group Executive Committee members).

iii Share Incentives

The Committee shall:

a. review the design and development of all share plans operated for the Executive Directors and/or requiring approval by the Board and/or shareholders and make recommendations to the Board about adopting any amendments to the terms of the plans.

b. for any such plans, approve and assess performance targets to be used (in line with approved corporate objectives) where applicable.

c. approve awards to Executive Directors and the overall amount of such awards, the individual awards for Executive Directors, other members of the Group Executive Committee, the Company Secretary and the Chief Internal Auditor.

d. exercise all powers under the rules of any Group share plan and approve any proposed actions of any committee, or other body appointed to administer the plans, as they pertain to grants, awards or maturities in respect of the Executive Directors, other members of the Group Executive Committee, the Company Secretary and the Chief Internal Auditor. This includes approving any change to the terms of options or awards granted if the initial grant was approved by the Committee.

Prudential plc
Page 5 of 7
Terms of reference – Remuneration Committee
Effective 1 January 2025
Approved by the Board on 3 December 2024

---

e. determine when clawback and malus will be invoked in respect of Executive Directors, or other staff within its purview.

f. review the aggregate dilutive effect of all share awards and option grants made to employees across the Group.

8. Reporting responsibilities

a. The Committee Chair shall report to the Board after each meeting on the nature and content of the discussion, recommendations and actions to be taken.

b. The Committee shall make whatever recommendations to the Board it deems appropriate on any area within its remit where action or improvement is needed.

c. The Committee shall provide confirmation to the Audit Committee that, to the best of the Committee's belief, the disclosures made on its activities and in the Directors' Remuneration Report, including the Directors' Remuneration Policy and its implementation, are fair, balanced and understandable.

d. The Committee shall provide a description of its work in the annual report in line with the requirements of relevant Listing Rules and Corporate Governance guidelines.

e. The Committee shall also ensure that other relevant laws and regulations, including provisions regarding disclosure of information under applicable Listing Rules and Corporate Governance Codes, are fulfilled, and that a Directors' Remuneration Report and, if necessary, the Directors' Remuneration Policy is included in the Company's Annual Report and put to shareholders for approval at the AGM.

9. Other matters

The Committee shall:

a. give due consideration to all relevant laws and regulations, the provisions of applicable Corporate Governance Codes and published guidelines or recommendations regarding the remuneration of company directors and the formation and operation of share incentive plans, and the requirements of applicable listing or other rules, as appropriate.

b. have access to sufficient resources in order to carry out its duties, including access to the Company Secretariat for advice and assistance as required.

c. consider the engagement and independence of external remuneration advisers.

d. be provided with appropriate and timely training, both in the form of an induction programme for new members and on an ongoing basis for all members.

e. ensure that a periodic evaluation of the Committee's own performance is carried out.

f. at least annually, review its terms of reference and recommend any changes it considers necessary to the Board for approval.

Prudential plc

Terms of reference – Remuneration Committee

Effective 1 January 2025

Approved by the Board on 3 December 2024

---

1. Authority

a. The Committee is authorised to select, appoint and agree the terms of appointment of any advisers deemed appropriate by the Committee to provide advice to the Committee, including those used by management provided no conflict of interest arises, at the Company's expense and through the Company Secretary's office where applicable.

b. The Committee is authorised to investigate any matter within its remit, seek any information from any of the Group's Directors and/or employees which is necessary to enable it to satisfactorily discharge its duties, and commission or purchase any reports, surveys or information which it deems necessary at the expense of the Company.

Prudential plc
Page 7 of 7
Terms of reference – Remuneration Committee
Effective 1 January 2025
Approved by the Board on 3 December 2024