PDJF Annual Review 2021

PDJF Annual Review 2021GRUNDFOS FOUNDATION GOVERNANCE Where does our money come from? Most of the Grundfos Foundation’s income in 2021 was dividend paid out based on Grundfos’ profit for the financial year 2020. Of this profit, 50 per cent was retained within the Grundfos Group, while the remaining 50 per cent was paid out as dividend to the company’s shareholders. Who receives dividend? The money paid out to shareholders as dividend is distributed according to the number of shares held by each shareholder. The Foundation is the majority share- holder in Grundfos. With 88 per cent of the shares, the Foundation receives 88 per cent of the dividend (or 44 per cent of the profit). The Due Jensen family shareholders received 10 per cent of the dividend (or 5 per cent of the profit). At the end of the 2020 financial year, current and former Grundfos employ- ee shareholders owned approximately 2 per cent of the shares and were able to receive 1 per cent of the profit. At the end of 2021, there were 7548 Grundfos shareholders in total. The Foundation would like to see Grundfos employees owning more of the shares in the future, so it is very satisfactory to see that the employee share programmes continue to be well received by the employees. Buy-back obligation According to two different shareholder agreements, the Foundation is obliged to buy back shares owned by other shareholders if they wish to sell them, or if they pass away. The obligations are estimated to be 6.3bn DKK in total. Most of these funds are kept available at short notice through Foundation’s capital management portfolio (see below). Sources of income and capital In addition to its dividend income from Grundfos, the Foundation invests its liquid reserves. To this purpose, the Foundation Board has approved an investment policy which complies with the United Nations’ Global Compact principles. A formal agreement has been made with the Grundfos Group Treasury who manages the portfolio on the Foundation’s behalf. Read more You can find the Foundation's accounts here: pdjf.dk/en/accounts Investment policy targets Bonds Min. 70% Shares Max. 30% Split year-end 2021 Bonds Shares 70% 30% At the end of 2021, the Foundation’s securities and cash at bank are worth approximately 7.1bn DKK in total. Taxes According to Danish tax law, the dividend income from Grundfos of a single majority owner like the Grundfos Foundation is exempt from taxes. The Foundation pays tax on return earned from other securities. 68Page 67Page 69