2. Composition of the Board of Directors

2.1 Composition

The Board is of the opinion that a number of between ten and fifteen members is appropriate for efficient decision-making on the one hand, and contribution of experience and knowledge from different fields on the other hand. Such a number also allows for changes to the Board’s composition to be managed without undue disruption. This is way within the provisions of the law and the Articles of Association of the Company from which the Board of Directors shall be composed of at least three members. The General Meeting of Shareholders decides of the number of Directors upon proposal of the Board of Directors.

A large majority of the Board members are non-executive Directors.

The curricula vitae of the Directors and directorship candidates are available for consultation on the UCB web site (www.ucb-group.com) which also mentions the directorships in other listed companies taken by each member of the Board.

2.2 Designation of Directors

The Directors are appointed by the General Meeting of Shareholders following a proposal by the Board of Directors on recommendation of the Remuneration and Nomination Committee.

In proposing candidates at the General Meeting of Shareholders, the Board of Directors takes particular account of the following criteria:

It ensures that a large majority of the Directors are non-executive Board Members.

It ensures that at least five non-executive Directors are independent in accordance with the legal criteria, and also the criteria adopted by the Board of Directors;

It ensures that no single Director or group of Directors may dominate decision-making.

It also ensures that the composition of the Board of Directors guarantees diversity and contribution of experience, knowledge and ability required for UCB’s specialist international activities.

It ensures that candidates are fully available to carry out their functions and that they do not take more than five directorships in listed companies.

2.2.1 The Remuneration and Nomination Committee gathers information, allowing the Board of Directors to ensure that the criteria set out above have been met at the time of the appointments and renewals and during the term of office.

For each new directorship appointment, the Remuneration and Nomination Committee performs an assessment of existing and required abilities, knowledge and experience on the Board of Directors. The profile of the ideal candidate is drawn up on the basis of this assessment. Details of candidates are then set out in a recommendation to the Board of Directors.

2.3 Independence of the Directors

In carrying out their duties each Director must fulfil their fiduciary duties of care, loyalty and good faith, and act in the best interests of the Company, its shareholders and other stakeholders. All Directors should be independent in their judgment and committed to the long term interests of the Company.

The law stipulates the independence criteria for application of certain regulations concerning conflicts of interests (Art. 524 Company Code), which call for a Committee to be formed of three «independent» Directors in accordance with the provisions of this law. Such independence is confirmed by the General Meeting of Shareholders every time a Director is elected or re-elected. At least three Directors meet these legal independence criteria.

Stricter independence criteria have been adopted by the UCB Board of Directors. By virtue of these, a Director is independent if:
he has not exercised executive functions within the Group for at least 3 years

he has not had business or other relations with the Group which could compromise his independent judgment. In relation to this criterion, significant status as customer, supplier or shareholder of the Group is taken into consideration by the Board of Directors on an individual basis.

The Belgian Code on Corporate Governance likewise stipulates criteria of which one is stricter than those laid down in law or the Board for assessment of the independence of Directors and which reads : ”not having served on the Board as a non-executive Director for more than three terms”.

For Directors whose term has been renewed more than three times, whilst they meet the independence criteria stipulated in law and by the Board they do not, however, due to the number of times their term has been renewed, meet all the independence criteria stipulated by the Belgian Code on Corporate Governance. Nevertheless the Board has considered that a long experience as a member of the UCB Board of Directors is not of such nature as to affect their independence as a Director.

According to the criteria set by the law, the Board of Directors and the Belgian Code on Corporate Governance, the representatives of the reference UCB shareholder are not considered to be independent. Although these Directors do not qualify as independent, they are independent from management.

2.4 Duration of mandates and age limit

Directors are appointed by the General Meeting of Shareholders for a 3-year term, and their terms may be renewed.

Moreover, an age limit of seventy has been stipulated; this takes effect on the day of the Annual General Meeting of Shareholders following the seventieth birthday of a member who, if need be, gives up his current term.

2.5 Procedure for appointment, renewal of terms and training

2.5.1 The process of appointment and re-election of Directors is run by the Board of Directors, which strives to maintain an optimum level of abilities and experience within UCB and its Board of Directors.

2.5.2 The proposals for appointment, renewal, resignation or possible retirement of a Director are examined by the Board of Directors based on a recommendation from the Remuneration and Nomination Committee.

The Board of Directors submits to the General Meeting of Shareholders its proposals concerning the appointments, renewals, resignations or possible retirement of Directors. These proposals are communicated to the General Meeting of Shareholders as part of the agenda of the relevant shareholders meeting.

The General Meeting of Shareholders rules on the proposals of the Board of Directors in this area by a majority of the votes.

In the event of a vacancy during a term, the Board of Directors is empowered to fill the post and to allow its decision to be ratified at the next General Meeting of Shareholders.

2.5.3 Proposals for appointment state whether or not the candidate is proposed as an executive Director, define the term proposed for the mandate: three years in accordance with the Articles of Association, and indicate the place where all useful information in relation to the professional qualifications of the candidate, in addition to the main functions and directorships of the candidate, may be obtained or consulted. These are available on the UCB web site (www.ucb-group.com).

The Board of Directors likewise indicates whether or not the candidate meets the independence criteria, in particular those stipulated by law, and satisfies the rules for treatment of conflicts of interest laid down in Article 524 of the Company Code; in the latter case, a proposal will be submitted to the General Meeting of Shareholders to acknowledge such independent character.

2.5.4 A UCB induction programme is arranged for new Directors. The programme is intended to allow them to learn the essentials of UCB as quickly as possible, including its governance, its strategies, its key policies, and its challenges in terms of research and development, operations, finance and risk management. Thus new Directors can contribute to the work of the Board of Directors and of its Committees of which they may become a member, over as short a period as possible. This programme is open to all Directors. Training either by internal sources or by third-party experts is also provided to the Board members when deemed useful for example on relevant new laws, regulations, business endeavours and changes in commercial risks.

2.6 Chairmanship and Vice-Chairmanship

Appointment of the Chairman and Vice-Chairman of the Board

The Board of Directors appoints a Chairman and a Vice-Chairman from among its members.

2.6.1 Role and responsibilities of the Chairman

The Chairman coordinates the activities of the Board of Directors. In particular, the Chairman ensures that the best practices of corporate governance apply to the relations between shareholders, the Board of Directors and management.

Following consultation with the Chairman and the Vice-Chairman of the Board of Directors, the Chairman of the Remuneration and Nomination Committee and the Chairman of the Executive Committee, the Board of Directors gives recommendations as to the general composition of the Board of Directors and of the committees created by the Board.

The Chairman also carries out the tasks stipulated by law and the Articles of Association and any produced by the Board of Directors, or following a request by the Chairman of the Executive Committee.

In particular, the Board of Directors provides the Chairman with the following powers:

The Chairman calls and arranges meetings of the Board of Directors;

The Chairman sets the agenda together with the Vice-Chairman of the Board of Directors and the Chairman of the Executive Committee;

The Chairman ensures that Directors receive precise, clear and complete information in good time, particular with regard to UCB’s performance;

The Chairman ensures that procedures relating to preparatory work, deliberations, passing of resolutions and implementation of decisions are properly followed;

The Chairman ensures that, in the exercise of functions, the Board of Directors carries the highest level of integrity and probity;

The Chairman ensures that all Directors contribute to discussions and decision-making;

The Chairman ensures that sufficient time is arranged to discuss complex or delicate issues. When this is deemed necessary, the Chairman arranges informal pre-meetings or creates specific committees to prepare discussions for the Board of Directors;

The Chairman ensures that Directors have sufficient time for reflection on delicate issues;

The Chairman presides over Ordinary and Extraordinary General Meetings of Shareholders, and ensures that shareholders have the chance to express their opinion, ask questions and receive suitable replies;

The Chairman must be available vis-à-vis the Chairman of the Executive Committee for advice in relation to issues concerning UCB strategy and major operations, or to represent UCB at events when required to do so;

Once a month, the Chairman attends an information meeting with the Chairman and the members of the Executive Committee and the Vice-Chairman of the Board;

The Chairman exchanges information with the Vice-Chairman of the Board of Directors and the Chairman of the Executive Committee once a month;

The Chairman ensures, together with the Remuneration and Nomination Committee, that the performance of the Directors, of the Board of Directors as a whole, and of its Committees are assessed on a regular basis.

2.6.2 Role and responsibilities of the Vice-Chairman

Among the non-executive Directors the Vice-Chairman is the main interlocutor of the Chairman of the Board in all the above areas, and is the representative of the UCB reference shareholder, Financière de Tubize SA.

The Chairman of the Board of Directors consults the Vice-Chairman whenever this is deemed necessary to allow functions to be accomplished efficiently and effectively.

In particular, the Vice-Chairman:

presides over the Board of Directors in the absence of the Chairman;

draws up the agenda for meetings with the Chairman of the Board of Directors and the Chairman of the Executive Committee;

attends the monthly information meeting with the Chairman of the Board of Directors, the Chairman and members of the Executive Committee;

exchanges information on a monthly basis with the Chairman of the Board of Directors and the Chairman of the Executive Committee.

2.7 Secretary of the Board

A Secretary of the Board has been appointed by the Board

to assist with the coordination of the Board meetings' preparation, agenda setting and premeeting materials

to draft the minutes

to generally facilitate Board processes and flow of information to Board members

to assist in company processes that strengthen Corporate Governance

For all Board and Company matters, each Board member has individual access to the Board secretary's assistance.