Aegon N : Corporate Governance Statement

Corporate Governance Statement

1. Dutch Corporate Governance Code – comply or explain

As a company based in the Netherlands, Aegon N.V. (also referred to as the ‘Company’) adheres to the Dutch Corporate Governance Code. The version of the Code applicable to the financial year 2021 is the version that came into force on January 1, 2017. The complete text of the Code can be found on www.mccg.nl. Aegon endorses the Code and strongly supports its principles for sound and responsible corporate governance and long-term value creation. Aegon regards the Code as an effective means to help ensure that the interests of all stakeholders are duly represented and taken into account. In general, Aegon applies the best practice provisions set out in the Code. There is one best practice provision that Aegon does not fully apply. In this case, Aegon adheres, as much as is possible, to the spirit of the Code.

Best Practice 4.3.3

The Dutch Corporate Governance Code recommends that the General Meeting of Shareholders may cancel the binding nature of nominations for appointments of members of the Executive Board (EB) and Supervisory Board (SB) with an absolute majority of votes and a limited quorum.

Aegon’s position on Best Practice 4.3.3.

Aegon’s Articles of Association provide for a larger majority and a higher quorum than those advocated by the Code. Given that the Company has no specific anti-takeover measures, the current system is deemed appropriate within

the context of the 1983 Merger Agreement under which Aegon was formed. However, to mitigate any possible negative effects stemming from this, the SB has decided that, in the absence of any hostile action, it will only make nominations for the appointment of members to the EB and SB that are non-binding in nature.

Corporate Governance Statement

2. Management and control systems relating to the process of financial reporting

Internal control

The EB of Aegon N.V. is responsible for establishing and maintaining adequate internal control over financial reporting. On an ongoing basis, Aegon reviews its internal procedures relating to the composition, preparation, and publication of its financial reporting. The EB has instituted procedures aimed at ensuring that material financial information is delivered to the EB in an orderly and timely fashion. The EB receives the financial information from the reporting units. The SB, acting primarily through the Audit Committee, oversees the compliance with these internal procedures. Specific regulations dealing with the audit function have been documented in the Audit Committee Charter and accompanying attachments.

Aegon’s internal control over financial reporting is a process designed under the supervision of Aegon’s principal executive and financial officers to provide reasonable assurance regarding the reliability of financial reporting and the preparation of its published financial statements. Internal control over financial reporting includes policies and procedures that:

• Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
• Provide reasonable assurance that transactions are recorded as necessary to permit the preparation of financial statements in accordance with generally accepted accounting principles;
• Provide reasonable assurance that receipts and expenditures are being made only in accordance with the authorizations of management and directors of the Company; and
• Provide reasonable assurance that unauthorized acquisition, use or disposition of company assets that could have a material effect on the Company’s financial statements would be prevented or detected in a timely manner.

The effectiveness of internal control is evaluated on at least an annual basis. Aegon works on an ongoing basis to assess

the appropriateness of internal controls to further strengthen the internal control environment and enhance its effectiveness.

Aegon’s internal control over financial reporting provides reasonable assurance regarding the reliability of financial reporting and the preparation and fair presentation of its published financial statements. However, because of its inherent limitations, internal control over financial reporting might not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate.

Internal auditor

Subject to approval of and along with a recommendation issued by the Audit Committee, the EB appoints and dismisses the internal auditor. The internal auditor draws up an audit plan, involving the EB, the Management Board (MB), the Audit Committee and the External Auditor in this process. This audit plan is submitted to the MB, and then to the SB, for approval. The EB, under supervision of the SB and its Audit Committee, is responsible for the internal audit function, including assessing the way in which the internal audit function fulfils its responsibility, and for monitoring the integrity of the financial statements of Aegon N.V..

Aegon Group’s Internal Auditor reports directly to the EB and the Audit Committee. In addition to the Group Internal Auditor function, there are also internal auditors at the reporting unit level who report to the Group Internal Auditor.

Corporate Governance Statement

Aegon’s Internal Audit Function (‘Internal Audit’) assists the EB, the Audit Committee of the SB and senior management in protecting Aegon’s assets, reputation and sustainability by independently and objectively evaluating the effectiveness of internal controls, risk management and governance processes with the following main responsibilities:

• Prepare and execute a risk-based annual audit plan which is approved by the EB and the AC of the Supervisory Board;
• Execute audits on the functioning of the first line and second line;
• Identify, and agree with management, opportunities to improve internal controls, risk management and governance processes and verify that such improvements are implemented within a reasonable period of time. Ensure that these are brought to the attention of the Audit Committee, as appropriate;
• Assist in the investigation of significant suspected fraudulent activities within Aegon or conduct special reviews or consulting which may not usually be included in the scope of Internal Audit and notify the AC of the results of these activities;
• Issue periodic reports to respective management and the Audit Committee, summarizing the progress and results of the annual audit plan, as well as on the sufficiency of Internal Audit resources;
• Ensure the AC is kept informed of emerging trends and successful practices in internal auditing;
• Consider the scope of work of the external auditors, regulators, and compliance and risk management teams, as appropriate, for the purpose of providing optimal audit coverage to the organization at a reasonable overall cost.

External auditor

Based on its Charter, the Audit Committee of the SB has determined the extent of the involvement of the external auditor in the audit and review of the financial reports (other than that of the annual accounts). In line with the Act on Accountancy Profession, the external auditor will not provide any other services to the Company. The external auditor is appointed by the shareholders at the Annual General Meeting of Shareholders. The Audit Committee reports annually to the SB on its dealings with the external auditor, particularly with regard to assessing its independence. The Audit Committee conducts an assessment of the functioning of the external auditor. The findings of this assessment will be shared with the General Meeting of Shareholders for the purposes of its deliberations on the annual appointment of the external auditor. The shareholders will be given the opportunity to question the external auditor at the General Meeting of Shareholders in relation to his or her auditor’s opinion on the fairness of the annual accounts.

The SB meets with the external auditor at least once a year on the occasion of the discussion of the annual accounts that are to be submitted for adoption to the General Meeting of Shareholders. The external auditor receives the information underlying the first half year figures to enable them to issue a review opinion on the condensed consolidated interim financial statements for the first half-year. As part of standing procedures, the external auditor also receives the information underlying the quarterly figures and other interim financial reports and is given ample opportunity to respond to all information. Reports by the external auditor of his or her findings in relation to the audit of the annual accounts are made to the Audit Committee and the SB. The external auditor may request that the chairman of the Audit Committee calls a meeting of the Audit Committee. The external auditor customarily attends the meetings of the Audit Committee and at least once per year, outside the presence of the EB.

In accordance with applicable laws, the external auditor reports on his activities to the Audit Committee and the SB, raising issues in relation to his audit that require the attention of management. Pursuant to the Audit Committee Charter such issues include significant financial reporting issues and judgments made in connection with the preparation of the financial statements, (including the quality of earnings), the selection or application of accounting principles (including any significant changes with respect thereto), any major issues as to the adequacy of its internal controls, and any special steps adopted in light of material control deficiencies. The SB is permitted to examine the most important points of discussion arising between the external auditor and the EB based on the draft management letter or the draft audit report.

Corporate Governance Statement

3. Shareholders’ meeting

General

A General Meeting of Shareholders is held at least once a year and, if deemed necessary, the SB or EB of the Company can convene an Extraordinary General Meeting of Shareholders. The main function of the General Meeting of Shareholders is to decide on matters such as the adoption of annual accounts, the approval of dividend payments and (re)appointments to Aegon’s SB and EB.

Meetings are convened by public notice at least 42 days before the meeting. The convocation states the time and location of the meeting, the record date, the agenda items, and the procedures for admittance to the meeting and representation at the meeting by means of a written proxy.

The record date is used to determine shareholders’ entitlements with regard to their participation and voting rights. In accordance with Dutch law, the record date is 28 days before the day of the General Meeting of Shareholders.

Agenda

The agenda and all relevant information will be provided to the shareholders upon convocation, unless overriding interests of Aegon are better served by not providing all the information. If such overriding interests are invoked, those reasons will be substantiated. All information which is relevant to shareholders and which must be published pursuant to the provisions of company and securities law is made available on Aegon’s website and will be sent to the shareholder in hard-copy upon request.

The agenda of the General Meeting lists which items are for discussion and which items are to be voted upon. The agenda items are explained in writing. When part of the agenda of the General Meeting of Shareholders, the following non-exhaustive list of types of resolutions will be submitted to the General Meeting as separate items to be voted upon:

• Adoption of the Annual Accounts;
• Amendments to the Articles of Association;
• The appointment of EB and SB members are submitted;
• Any changes to Aegon’s dividend policy;
• Any changes to the EB’s remuneration policy;
• Any resolution to declare a final dividend;
• Any major changes in the Corporate Governance of the Company;
• Release from liability of the members of the EB for their management;
• Release from liability of the members of the SB for their supervision;
• Granting authorizations to the EB to issue shares;
• Granting authorizations to the EB to restrict or exclude pre-emptive rights;
• Granting authorizations to acquire shares in the Company; and
• Any resolution listed in Article 20.1 of the Articles of Association of the Company and, as such, entailing significant changes to the identity or character of Aegon.

Those shareholders who alone, or jointly, represent at least 1% of Aegon’s issued capital or a block of shares worth

at least EUR 100 million may request items be added to the agenda of these meetings. In accordance with Aegon’s Articles of Association, such requests will be granted, providing they are received in writing at least 60 days before the meeting and unless important interests of the Company dictate otherwise. Upon a shareholder’s request that an item be put on the agenda of the General Meeting that may result in a change in the Company’s strategy, the EB may invoke a response time of at most 180 days for further deliberation and constructive consultation.