Review of appropriateness and customariness of Board of Management remuneration and compliance with maximum remuneration

The Supervisory Board determines the structure of the Board of Management remuneration system and reviews the appropriateness and customariness of remuneration on a regular basis. It is to be ensured that Board of Management remuneration is oriented toward sustainable development and that there is a multi-year measurement base for the variable components for a target achievement level of 100 %.

The General Committee of the Supervisory Board reviewed the appropriateness and customariness of Board of Management remuneration at Deutsche Telekom AG in 2025. The review was carried out based on a study done by an independent external service provider on the remuneration components and remuneration levels at DAX 40 companies. Based on the statistical classification (revenue, employees, and market capitalization), Deutsche Telekom AG is currently in the top quarter of this group of peer companies. To take account of the differences within the DAX 40, particular attention was paid in the review to the twelve largest companies in the index. In addition, the Supervisory Board analyzes the remuneration systems and remuneration levels of European and international telecommunications companies at regular intervals with the assistance of an external service provider. The analysis showed that these companies do not serve as a suitable benchmark for the remuneration of the Board of Management of Deutsche Telekom AG due to their different sizes and geographical location.

It was ascertained that the remuneration components applied in the Board of Management remuneration system are in line with market standards. When introducing the current remuneration system, the Supervisory Board adjusted the remuneration levels of the Board of Management members, having already signaled the need for action in the 2024 remuneration report, which means that the members of the Board of Management are now compensated according to stock corporation law at a level appropriate to their tasks and performance and to the situation of the Company.

In addition, in accordance with § 162 (1) AktG, the Supervisory Board shall ensure compliance with maximum remuneration and shall outline this in the remuneration report.

The Supervisory Board generally set the current maximum remuneration for the Chair of the Board of Management at EUR 11,000,000 and for the ordinary members of the Board of Management at EUR 6,500,000. For the current CEO, Timotheus Höttges, a maximum remuneration of EUR 14,000,000 was set as an exception. The Shareholders’ Meeting on April 9, 2025 approved this maximum remuneration. Once Timotheus Höttges’ Board appointment ends, the maximum remuneration for the Chair of the Board of Management will return to EUR 11,000,000. The maximum remuneration of EUR 5,300,000 approved by the 2022 Shareholders’ Meeting still applies to Claudia Nemat and Srinivasan Gopalan.

The following components are taken into account for the review of maximum remuneration in accordance with the 2025 remuneration system:

Compliance with maximum remuneration can only be evaluated retrospectively when the last remuneration component from the financial year in question has been paid out. The current and the previous Board of Management remuneration system each includes two multi-year variable remuneration components. The LTI and the SMP each have a term of four years. To participate in the SMP, the Board of Management member must use the gross STI paid out in the prior year to make a personal investment in Deutsche Telekom AG shares, which are then locked up for four years from the date of purchase.

This means that it is only possible to provide a final report on compliance with maximum remuneration for the 2025 financial year in the 2030 remuneration report. If it is clear at an earlier point in time that the maximum remuneration will be exceeded, the payment of the remuneration component causing the maximum remuneration to be exceeded is capped straight away.