Dr Hönle : Corporate Governance Report 2021/2022

Corporate Governance Statement

pursuant to Section 289f HGB and Section 315d HGB

Declaration of compliance with the German Corporate Governance Code (DCGK) pursuant to Section 161 AktG of 23 January 2023

The Management Board and Supervisory Board of a stock corporation listed in Germany are obliged under Section 161 (1) AktG to submit a declaration at least once a year about the extent to which the recommendations of the DCGK have been complied with in the past and how this is intended for the future. Dr. Hönle AG attaches great importance to the rules of proper corporate governance. The Management Board and the Supervisory Board of Dr. Hönle AG published the following Compliance Declaration on 23 January 2023.

The Management Board and Supervisory Board of Dr. Hönle AG declare pursuant to Section 161 of the German Stock Corporation Act (AktG) that the recommendations of the Government Commission on the German Corporate Governance Code as amended on 28 April 2022, published by the Federal Ministry of Justice and Consumer Protection (BMJ) in the official section of the Federal Gazette have been and are being complied with, with the following exceptions:

A.2 Governance tasks of the Management Board; observance of diversity when filling executive positions

The German Corporate Governance Code recommends that the Management Board shall consider diversity when filling executive positions (Recommendation A.2 DCGK 2022). The Management Board is of the opinion that diversity aspects should not play a role in filling executive positions, but rather the personal qualifications and individual skills of the respective manager concerned should be the main focus.

A.4 Governance tasks of the Management Board; protected whistleblower system

The German Corporate Governance Code recommends that employees and third parties shall suitably be given the opportunity to report, in a protected manner, suspected breaches of the law within the enterprise (Recommendation A.4 DCGK 2022). Dr. Hönle AG is currently examining various whistle- blower systems. The implementation of a protected whistleblower system is expected to take place in the first half of 2023.

B.1 Appointments to the Management Board; taking diversity into account

The German Corporate Governance Code recommends that the Supervisory Board shall take diversity into account when appointing Management Board members (Recommendation B.1 DCGK 2022). The Supervisory Board will generally base its selection of Management Board members on the qualifications and individual skills of the candidate. In the opinion of the Supervisory Board, gender, age or other diversity aspects are not decisive when making appointments to the Management Board. The sole decisive factor is to find the most suitable person for the Management Board position to be filled.

B.4 Appointments to the Management Board; re-appointment prior to one year before the end of an appointment period

The German Corporate Governance Code recommends that only in the presence of special circum- stances, Management Board members shall be re-appointed prior to one year before the end of an appointment period given termination of the current appointment at the same time (Recommendation B.4 DCGK 2022). Under stock corporation law, neither special nor good cause is required for premature re-appointment prior to one year before the end of the term of appointment with simultaneous termination of the current appointment. The Supervisory Board observes the provisions under stock corporation law concerning the re-appointment of Management Board members. At the same time, how- ever, in the interest of the Company, the Supervisory Board aims at responding as flexibly as possible to the requirements it considers necessary for the re-appointment of a Management Board member without the need for special circumstances applying within the meaning of the Code recommendation.

1

B.5 Appointments to the Management Board; specification of an age limit for Management Board members

The German Corporate Governance Code recommends that an age limit shall be specified for members of the Management Board and be disclosed in the Corporate Governance Statement (Recommenda- tion B.5 DCGK 2022). The Supervisory Board is of the opinion that the personal qualifications and individual competences of Management Board members are decisive with respect to appointments to the Management Board, rather than age. Consequently, the Supervisory Board of Dr. Hönle AG has not specified any fixed age limits for Management Board members.

C.1 Composition of the Supervisory Board; determination of specific objectives

The German Corporate Governance Code recommends that the Supervisory Board shall determine specific objectives regarding its composition and prepare a profile of skills and expertise for the entire Board while taking diversity into account (Recommendation C.1 DCGK 2022). Proposals by the Supervisory Board to the General Meeting shall take these objectives into account, while simultaneously aiming at fulfilling the overall profile of required competences and expertise for the entire Board. The implementation status shall be disclosed in the Corporate Governance Statement. This shall also provide information on the number of independent shareholder representatives on the Supervisory Board that is appropriate in the opinion of the shareholder representatives and the names of these members. Dr. Hönle AG is of the opinion that personal qualifications and individual competences rather than, for ex- ample, gender, age or other diversity aspects or the Company's ownership structure, are decisive when making appointments to the Supervisory Board. Dr. Hönle AG views such a definition as an inappropriate restriction of the shareholders' right to elect the members of the Supervisory Board. The Supervisory Board has therefore not specified any specific objectives or skills and expertise profiles for its composition within the meaning of the Code.

C.2 Composition of the Supervisory Board; age limit to be specified for Supervisory Board members The German Corporate Governance Code recommends that an age limit shall be specified for members of the Supervisory Board and disclosed in the Corporate Governance Statement (Recommendation C.2 DCGK 2022). So far, the Supervisory Board of Dr. Hönle AG has not specified any fixed age or length of appointment limits for its members as it considers such specification to be an inappropriate restriction of the shareholders' right.

D.2, D.3, D.4 Supervisory Board procedures; Supervisory Board committees

The German Corporate Governance Code recommends that, depending on the specific circumstances of the enterprise and the number of Supervisory Board members, the Supervisory Board shall form committees of members with relevant specialist expertise. This recommendation D.2 and the further recommendations D.3 and D.4 of the DCGK 2022 refer to the requirements for the composition and chairmanship of the relevant committees. The Supervisory Board of Dr. Hönle AG had three members until 19 May 2021 and therefore had no committees since these are also required to consist of at least three members. Since 20 May 2021, the Supervisory Board of Dr. Hönle AG has included four members and since 26 April 2022 of five members. The Supervisory Board of Dr. Hönle AG has had an audit committee since January 2022.

F.2 Transparency and external reporting; publication deadlines for financial information

The German Corporate Governance Code recommends that the consolidated financial statements and group management report shall be made publicly accessible within 90 days from the end of the financial year, while mandatory interim financial information shall be made publicly accessible within 45 days from the end of the reporting period (Recommendation F.2 DCGK 2022). As before, the Dr. Hönle AG will continue to publish preliminary figures for the financial year within 90 days. However, in accordance with the rules of the Frankfurt Stock Exchange for Prime Standard stocks, the annual report is published within four months from the end of the reporting period. Semi‐annual reports and quarterly reports are published within two months from the end of the reporting period in accordance with the rules of the Frankfurt Stock Exchange. The shortening of the publication times would increase the administrative costs in an unreasonable proportion. The publication deadlines will therefore remain unchanged until further notice.

2

G.6 Remuneration of the Management Board; proportion of long-term term targets in relation to short-term targets in variable remuneration

The German Corporate Governance Code recommends (Recommendation G.6 DCGK 2022) that the share of variable remuneration achieved as a result of reaching long-term targets shall exceed the share from short-term targets. The Supervisory Board of Dr. Hönle AG is is of the opinion that the Management Board of Dr. Hönle AG ensures the long-term and sustainable development of the Company even if the variable remuneration achieved as a result of reaching long-term targets does not exceed the share from short-term targets.

G.7 Remuneration of the Management Board; performance criteria for variable remuneration components

The German Corporate Governance Code recommends that for the upcoming financial year the Supervisory Board should determine the performance criteria for all variable remuneration components for each individual member of the Board of Management, which - in addition to operational ones - should be based primarily on strategic objectives (Recommendation G.7 GCGC 2022. The Supervisory Board shall also determine to what extent individual targets for each Management Board member - or targets for the entire Management Board as a whole - are decisive for the variable remuneration compo- nents. The Supervisory Board of Dr. Hönle AG is of the opinion that operational performance criteria also encompassing a strategic objective are to be used for the majority of variable remuneration components for the Management Board of Dr. Hönle AG. The Supervisory Board is of the opinion that the definition of the individual targets for the Management Board members should not be decisive for the variable remuneration components. A remuneration system based on the determination of individual targets would be too complicated and might also offer too much room for interpretation.

G.10 Remuneration of the Management Board; variable remuneration based on company shares The German Corporate Governance Code recommends that, taking the respective tax burden into con- sideration, variable remuneration amounts respecting Management Board members shall be invested predominantly in company shares by the respective Management Board member, or shall be granted as share-basedremuneration. Granted long-termvariable remuneration components shall be accessible to Management Board members only after a period of four years (Recommendation G.10 DCGK 2022). The remuneration system of Dr. Hönle AG does not provide for variable remuneration based on shares in the Company or corresponding share-basedremuneration. The system of variable remuneration has been tried and tested at Dr. Hönle AG over a long period of time. Consequently, Dr. Hönle AG does not plan to change this system.

G.11 Remuneration of the Management Board; extraordinary developments

The German Corporate Governance Code recommends that the Supervisory Board shall have the possibility to account for extraordinary developments to an appropriate extent (Recommendation G.11 DCGK 2022). It shall be permitted to retain or reclaim variable remuneration if justified. In accordance with Section 87 (2) AktG, the Supervisory Board should reduce the remuneration to the appropriate amount if the Company's situation deteriorates to such an extent that it would be unreasonable for the Company to continue to grant the remuneration under paragraph 1. According to this, the Supervisory Board already has a statutory right to reduce the Management Board's remuneration. In the view of the Supervisory Board of Dr. Hönle AG, there is no need for any further contractual rights to account for extraordinary developments.

G.13 Remuneration of the Management Board; severance cap and offsetting against non-compete compensation payments

The German Corporate Governance Code recommends that any payments made to a Management Board member due to early termination of their Management Board activity shall not exceed twice the annual remuneration (severance cap) and shall not constitute remuneration for more than the remaining term of the employment contract. If post-contractualnon-compete clauses apply, the severance payments shall be taken into account in the calculation of any compensation payments (Recommenda- tion G.13 DCGK 2022). From the point of view of the Supervisory Board of Dr. Hönle AG, the severance payment for the contractual remaining term of the Management Board service contract and the compensation payment due to a post‐contractual non-compete clause are two fundamentally different

3

payments. The severance payment for the remaining contractual term is based on the remaining term in the service contract. If the remaining term is more than two years at the time of early termination, the Company feels bound by the contract and accordingly grants remuneration for the entire remaining term. The post‐contractual non‐compete clause, on the other hand, aims to ensure that the Management Board member does not start working directly for a competitor after termination of his or her activity on the Management Board. The Management Board member is entitled to compensation for this. However, in the opinion of the Supervisory Board, the non-compete compensation payment is not materially related to the severance payment for the remaining contractual term. Therefore, in the opinion of the Supervisory Board, offsetting the non-compete compensation payment against the severance payment is not convincing.

G.16 Remuneration of the Management Board; Supervisory Board decision on the offsetting of remuneration from supervisory board memberships at non-group entities against the remuneration of the Management Board members

The German Corporate Governance Code recommends that when members of the Board of Management assume Supervisory Board mandates outside the Group, the Supervisory Board should decide whether and to what extent the compensation is to be credited (Recommendation G.16 DCGK 2022). The Supervisory Board is of the opinion that the members of the Board of Management themselves should be able to decide on their own responsibility within the scope of their management competence and in accordance with their duty to exercise discretion whether, in view of the time required for their Board of Management mandate, they can accept further Supervisory Board mandates outside the Group. To the extent that the members of the Board of Management agree, the Supervisory Board is of the opinion that the compensation for Supervisory Board membership outside the Group should not be offset against the Management Board compensation of the Management Board member con- cerned, as the Supervisory Board compensation for Supervisory Board memberships outside the Group is intended to compensate the additional workload associated with the Supervisory Board membership of the person concerned.

Reference to the Company's website, on which the remuneration report for the last financial year and the auditor's assurance report pursuant to Section 162 AktG AktG, the applicable remuneration system pursuant to Section 87a Paragraphs 1 and 2 Clause 1 AktG and the last remuneration resolution pursuant to Section 113 Paragraph 3 AktG are made publicly accessible

Section 289f of the German Commercial Code (HGB) in the version applicable from 1 January 2020 is to be applied for the first time to annual and consolidated financial statements as well as management and group management reports for the financial year beginning after 31 December 2020. The information on the remuneration report for the last financial year and the auditor's assurance report pursuant to Section 162 of the German Stock Corporation Act and the last remuneration resolution pursuant to Section 113 (3) of the Stock Corporation Act did not yet have to be published separately on Dr. Hönle AG's website. The remuneration system resolved by the Supervisory Board pursuant to Section 87a Paragraphs 1 and 2 Clause 1 of the German Stock Corporation Act, which was approved by the Annual General Meeting on 23 March 2021, is available on the website of Dr. Hönle AG at https://www.hoenle.de/investoren/corporate-governance.The remuneration report pursuant to Section 289f HGB in the version applicable from 1 January 2020 is to be applied for the first time to the 2021/2022 financial and will be published on 30 January 2023 at https://www.hoenle.de/in-vestoren/corporate-governance.

Information on corporate governance practices

In addition to the statutory regulations and the German Corporate Governance Code (DCGK), Dr. Hönle AG attaches great importance to acting responsibly in all areas of the Group. However, this conduct has not been regulated in a specific code of conduct so far, but was lived in daily practice. Since De- cember 2022, Dr. Hönle AG has had a binding Code of Conduct, published on the Internet at https://www.hoenle.de/investoren/corporate-governance.

4

Description of the working methods of the Management Board and the Supervisory Board and the composition and working methods of their committees

The Management Board and Supervisory Board of Dr. Hönle AG form the dual management and control structure as stated under the provisions of the German Stock Corporation Act. The Management Board and the Supervisory Board work closely together for the benefit of the Company.

Tasks and working methods of the Management Board

At present, the Management Board of Dr. Hönle AG consists of two members. It was comprised of three members in the period from January 2021 through September 2022. The Management Board is responsible for managing the Company in the Company's interests, developing the Company's strategic direction, coordinating it with the Supervisory Board and ensuring its implementation. The Management Board conducts the Company's business on its own responsibility in accordance with the law, the articles of association and the rules of procedure of the Management Board, thereby taking into account the resolutions made at the Annual General Meeting. The allocation of responsibilities and cooperation within the Board of Management are governed, among other things, by the Rules of Procedure for the Board of Management. Dr. Hönle AG has had a Management Board Chairman since September 2022. The Management Board represents the company vis-à‐vis third parties. The Management tasks include regular strategic discussions at Management Board level and with the divisional heads. The Management Board is informed monthly about the development of key parameters of Dr. Hönle AG and its subsidiaries. The Management Board takes suitable measures to identify any developments that may jeopardize the continued existence of the Company at an early stage. This system is continuously being enhanced and adapted to changing framework conditions. The risk report includes further information on risk management.

Tasks and working methods of the Supervisory Board

The Supervisory Board of Dr. Hönle AG appoints the Management Board members, monitors and advises the Management Board on the management of the business. It is involved in all decisions of fundamental importance at all times in a timely and appropriate manner. The Management Board informs the Supervisory Board regularly, promptly and comprehensively about the course of business, results of operations and financial position, the employment situation as well as the Company's planning and projects. In preparation for the meeting dates, the Supervisory Board receives regular written reports from the Management Board. After careful examination and consultation, the Supervisory Board adopts resolutions, if necessary. Rules of procedure regulate the tasks of the Supervisory Board and the internal organization of the Supervisory Board. The rules of procedure are publicly accessible on the Internet at https://www.hoenle.de/investoren/corporate-governance(Recommendation D.1 DCGK 2022). The Supervisory Board holds at least two meetings every six months. The meetings of the Supervisory Board are usually held in person. The meetings of the Supervisory Board are convened by the Chairman of the Supervisory Board or, if he is prevented from doing so, by his deputy. The resolutions of the Supervisory Board are passed in meetings chaired by the Chairman of the Supervisory Board. The Chairman of the Supervisory Board determines the type of vote. Resolutions may also be adopted in writing, by telex, telephone, fax or telegraph if no member of the Supervisory Board objects to this procedure immediately. Resolutions of the Supervisory Board are passed with a simple majority of the votes cast, unless otherwise stipulated by law or the articles of association. Further details on the activities of the Supervisory Board are set out in the report of the Supervisory Board.

The German Corporate Governance Code recommends that the Supervisory Board, together with the Management Board, shall ensure that there is long-term succession planning (Recommendation B.2 DCGK 2022). The Supervisory Board of Dr. Hönle AG is in constant communication with the Management Board as to whether the current composition of the Management Board corresponds to the Company's strategic objectives or whether additional Management Board members should be appointed in order to meet the Company's strategic objectives. Employees and managers of the Company individually receive training and are prepared for possible management positions. As a matter of principle, the Supervisory Board initially tries to recruit executives for a position on the Executive Board from within the Group in a targeted manner. If no suitable candidates are available within the Group, the Supervisory Board uses recruitment agencies to identify and recruit suitable candidates for a Management Board position that may have to be filled.

5