For immediate release
2 September 2022
CSL ANNUAL REPORT 2021/22
Melbourne, Australia – CSL (ASX:CSL; USOTC:CSLLY).
The CSL Board of Directors is pleased to release CSL’s 2021/2022 Annual
Report.
Authorised for lodgement by:
Fiona Mead
Company Secretary
For further information, please contact:
Investors:
Media:
Bernard Ronchi
Investor Relations
P: +613 9389 3470
E: Bernard.Ronchi@csl.com.au
Jimmy Baker
Communications, Asia Pacific
P: +61 450 909 211
E: Jimmy.Baker@csl.com.au
Driven by Our Promise
CSL Limited Annual Report 2021/22
Contents
1 Chair and CEO message
2 Our Company
3 Our Performance and Strategy
4 Our Material Risks
5 Our Future Prospects
6 Powered by Innovation
7 Our People
2
8
16
24
26
29
37
8 Environment
9 Social
10 Governance
11 Financial Performance
12 Share Information
13 Key Performance Data Summary
14 Medical Glossary
42
48
54
63
147
150
151
CSL Calendar
2022
17 August
Annual results and final dividend
announcement
6 September
Shares trade ex-dividend
7 September
Record date for final dividend
5 October
Final dividend paid
12 October
Annual General Meeting
31 December Half Year ends
2023
15 February
9 March
10 March
5 April
30 June
16 August
Half Year results and interim dividend
announcement
Shares trade ex-dividend
Record date for interim dividend
Interim dividend paid
Full Year ends
Annual results and final dividend
announcement
11 September
Shares trade ex-dividend
12 September Record date for final dividend
4 October
Final dividend paid
11 October
Annual General Meeting
31 December Half Year ends
Annual General Meeting
The 2022 Annual General Meeting (AGM) of CSL Limited
(ABN 99 051 588 348) will be held on Wednesday,
12 October 2022 at 10am (Melbourne time) at the
Clarendon Auditorium, Melbourne Convention and
Exhibition Centre, South Wharf, Melbourne 3000.
Find out more CSL.com
About this report
This Annual Report combines CSL’s financial and non-financial
performance in one comprehensive account, linking our sustainability
and strategic priorities to our business results. Unless otherwise
stated, this report covers CSL’s subsidiaries as listed on page 131.
CSL conducted its fifth sustainability materiality assessment in
2021/22. The prioritised results of our assessment are available within
this report and on CSL.com. In addition to an independent audit of
our consolidated financial accounts, limited assurance on a selection
of corporate responsibility (CR) metrics has been provided by Ernst
& Young, and an assurance statement for non-financial indicators,
along with more detailed Group and CR information, including our
materiality assessment, can be found on CSL.com (Our Company >
Corporate Responsibility).
Legal notice: This report is intended for global use.
This 2022 Annual Report is a summary CSL’s operations and activities for the 12-month period ended 30 June 2022 and financial position as at 30 June 2022.
This report covers CSL’s global operations, including subsidiaries, unless otherwise noted. A reference to CSL, CSL Group, we, us and our and similar expressions
refer collectively to CSL Limited and its related bodies corporate.
Some statements about products, registered product indications or procedures may differ in certain countries. Therefore, always consult the country-specific
product information, package leaflets or instructions for use. For more information, please contact a local CSL representative.
Brand names designated by a ® or a ™ throughout this publication are trademarks either owned by and/or licensed to CSL or its affiliates. Not all brands
mentioned are used or registered as trade marks in all countries served by CSL.
Forward-looking statements
This report contains forward-looking statements including statements with respect to future company compliance and performance. This report also includes
forward-looking statements regarding climate change and other environmental and energy transition scenarios. While these forward-looking statements reflect
CSL’s expectations at the date of this report, they are not guarantees or predictions of future performance or statements of fact. These statements involve known
and unknown risks and uncertainties. Many factors could cause the Group’s actual results, performances or achievements to differ, possibly materially, from those
expressed in the forward-looking statements. These factors (including significant geopolitical issues relating to war in Ukraine, supply chain disruptions, energy
security and inflation) include changes in government and policy; actions of regulatory bodies and other governmental authorities such as changes in taxation
or regulation (or approvals under regulation); the effect of economic conditions; technological developments in the healthcare field; advances in environmental
protection processes; and uncertainty and disruption caused by the COVID-19 pandemic and geo-political developments. There are also limitations with respect
to scenario analysis, and it is difficult to predict which, if any, of the scenarios might eventuate. Scenario analysis is not an indication of probable outcomes and
relies on assumptions that may or may not prove to be correct or eventuate.
Readers are cautioned not to place undue reliance on forward-looking statements.
Except as required by applicable laws or regulations, CSL does not undertake to publicly update or review any forward-looking statements. Past performance
cannot be relied on as a guide to future performance.
Non-IFRS
References to AASB refer to the Australian Accounting Standards Board and IFRS refers to the International Financial Reporting Standards. There are references
to IFRS and non-IFRS financial information in this report. Non-IFRS financial measures are financial measures other than those defined or specified under
any relevant accounting standard and may not be directly comparable with other companies’ information. Non-IFRS financial measures are used to enhance
the comparability of information between reporting periods, and enable further insight and a different perspective into the financial performance. Non-IFRS
financial information should be considered in addition to, and is not intended to be a substitute for, IFRS financial information and measures. Non-IFRS financial
measures are not subject to audit or review.
CSL Limited ABN 99 051 588 348
Our Purpose
The people and science of CSL save lives. We develop
and deliver innovative medicines that help people
with serious and life-threatening conditions live full
lives and protect the health of communities around
the world. Our CSL Values guide us in creating
sustainable value for our stakeholders.
Arthur’s
story
Staying active
has always
been a priority
for Arthur.
Arthur grew up playing sports and later moved on to weightlifting and
bowling. In his late 30s, however, he was robbed of his mobility and left
in severe pain by chronic inflammatory demyelinating polyneuropathy
(CIDP). CIDP is a rare neurological disorder that can lead to symptoms
such as weakness, paralysis or impairment in motor function,
especially in the arms and legs.
After following a journey to diagnosis that lasted nearly 15 years,
Arthur finally found the right treatment and is getting back to some
of the activities that make him who he is.
He’s also advocating for fellow CIDP patients and encouraging others
to do the same. As he puts it, ‘We need to speak up, work hard and
be determined to overcome this.’
1
CSL Limited Annual Report 2021/22 The return of our ability to travel has meant that the Board
has been able to come together in person more often, and
I particularly enjoyed visiting our Kankakee and Holly Springs
facilities in the United States with my fellow Board members
and meeting the dedicated teams working at those sites.
Last year we announced our new sustainability strategy.
While this has always been a focus for us at both the Board
and operational levels, I am pleased to say the new strategy
has provided us a refreshed impetus to be clear about our
sustainability priorities. You can read about our progress,
and specifically for the environment, further in this document.
An Opportune Time
Although the global pandemic has entered a new phase,
the operating environment continues to prove testing.
Once again, I would like to thank our Managing Director and
Chief Executive Officer, Paul Perreault, his Global Leadership
Group and all of our CSL colleagues for successfully navigating
your company through this challenging time.
There has been an overwhelming response to the pandemic
from the scientific community, including CSL, and the many
partners we engage with all over the world. Our partnership
with AstraZeneca for example, manufactured 50 million
doses of the VAXZEVRIA® COVID-19 vaccine requisitioned
by the Australian Government. This enabled the protection
of millions of Australians, as well as many of the country’s
neighbours in the Pacific region.
While we hope that the pandemic challenge starts to
fade, it is in the nature of our industry to look to the other
problems we try to solve every day, and work out how we
can approach them more effectively. These unmet medical
needs are an opportunity for our people, from our scientists,
researchers, knowledge workers, to our manufacturing
experts and phlebotomists to contribute to helping protect
the health of communities around the world. This pursuit
has received a great boost over the past two years as we
have witnessed new approaches to clinical trials, fast-tracked
approval processes and new precedents for what
collaboration can look like.
This is an opportune time for our company to meet the
world’s increasing expectations, and our industry to heighten
its contribution to achieving a healthier world.
1 Chair and CEO Message
Chair Message
Dear Fellow Shareholders,
I am pleased to share our results and operating review for
2021/22, from which you will see that CSL, supported by the
strength of its foundations and an agile approach, is poised
to deliver sustainable growth to our stakeholders.
Poised for Growth
CSL has continued to be resilient to the external environment
over the 2021/22 financial year. Our 2030 Strategy and our
values continue to guide our leaders all the way through
to our frontline employees.
Measured and ongoing investment into our business has
been a key enabler of growth, and will continue to underpin
that growth into the future. Our global capital investment
program has advanced according to plan, and we continue
to make great progress in our research and development
(R&D) pipeline.
During the financial year, the Board approved the proposed
acquisition of Vifor Pharma, a global pharmaceutical company
focusing on the treatment areas of iron deficiency, dialysis,
nephrology and rare disease. Through this acquisition,
our global reach, R&D capabilities, and balance sheet will
help accelerate opportunities to bring new and innovative
products to the large and underserved community of
people suffering with kidney disease and iron deficiencies.
The Board looks forward to the full integration of this
business and we thank shareholders for their support
for this acquisition.
Our Governance Priorities
Another way we ensure we are poised to take advantage of
the many opportunities afforded to us is through rigorous,
best-practice governance, which is always a major focus of
the Board.
In line with an observed trend in many jurisdictions towards
a tenure limit for audit firms, we completed a competitive
tender process to appoint new external auditors. This
appointment is subject to shareholder approval at CSL’s
2023 Annual General Meeting. If approved by shareholders,
Deloitte Touche Tohmatsu will be CSL’s external auditor
for the 2024 financial year (commencing 1 July 2023).
We wish to thank EY for their many years of distinguished
service to shareholders.
The composition of the Board is an ever-present priority.
We aim to have the right skills and expertise to navigate our
industry and the broader macro environment. We believe
we have a strong and complementary dynamic that will
continue our long track record of exceptional governance.
22
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 US$2.255
billion in reported net profit after tax
US$2.22
dividend per share for 2022
Outlook
While I began this note expressing my optimism, I am always
wary of the broader environment in which we operate.
At the time of writing there are significant geopolitical issues
relating to war in the Ukraine, supply chain disruptions,
energy security, and inflation.
There are no quick fixes to many of these issues, but the
vital nature of the products and treatments that CSL
produces means we can factor in a level of confidence
to our growth plan.
I can assure you that we will work to control what is within
our control with the people who rely on our vaccines and
therapies as our priority. As always, in doing so we will
continue to strive to create value for shareholders. I am
pleased to report that the total full year dividend per share
is US$2.22 per share, which is held constant with the
previous financial year.
Thank you for your ongoing support of our company.
Brian McNamee AO
Chair
More on CSL.com (Investors > Financial Results and Information)
33
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 1 Chair and CEO Message
CEO Message
Dear Shareholders,
I am pleased to be addressing you after another year
when CSL was able to deliver solid results, as promised,
in an ongoing complex global environment.
As I move around and connect with our people, patients
and donors, I have been reminded repeatedly that when we
trust in science and our purpose, the reward is repaid many
times over, and allows us to continue delivering our promises
to our stakeholders.
Culture is Key
Whilst science has firmly and rightly been in the spotlight
through the pandemic, progress in this domain does not
happen without talented people.
As our people continue to connect both virtually and in
person across plasma centres, our manufacturing sites, our
research labs and our offices, there are many conversations
within and between the diverse teams of people who make
CSL so successful. The common thread I hear is that,
although life has changed, our people stay motivated
day-to-day through an overwhelming dedication to our
purpose and our values.
Together, these have driven a culture that is not easily
replicable, and one that I truly believe is unique and
enduring at CSL.
The science and people of CSL save lives, and it is important
to our leaders that employees feel motivated and proud to
come to work, and that they have a promising future with
us. This priority has been acknowledged this year with CSL
honoured to be recognised as one of Australia and New
Zealand’s best places to work by the Australian Financial
Review. In March, Forbes magazine also named CSL among
America’s Best Employers for 2022. It is encouraging to see
that we are making progress and are receiving recognition
for our efforts.
Executing on Our 2030 Strategy
CSL’s strategic framework guides us in how we make
considered strategic decisions to evolve our organisation
so that it remains effective, sustainable and efficient.
Our priority areas are: people and culture, focus, innovation,
efficiency and supply, sustainable growth and digital
transformation. You can read more about these in detail
on page 19 of this report, but I want to reiterate that we
are executing to plan and I am pleased with the progress
we’ve made so far, particularly in relation to setting
emissions reduction targets.
I would also like to elaborate on Dr McNamee’s comments
regarding Vifor Pharma. In December, we were pleased to
enter into an agreement to acquire Vifor Pharma, a global
specialty pharmaceutical company with leadership in renal
disease and iron deficiency.
The acquisition fits strongly with our strategy. It adds a
durable and growing business with leadership positions
across nephrology, dialysis and iron deficiency, and will
provide a platform to build a significant renal franchise.
It also extends the reach of CSL’s high-value pipeline in
the renal space by leveraging enhanced access to unique
patient populations which will support clinical trial execution.
44
The acquisition was funded through an institutional
placement, a share purchase plan and a debt raising
and I would like to thank all of our stakeholders for the
overwhelming support they have shown for the transaction.
Now, we look forward to the important work of integrating
this business into the CSL family and driving the sustainable
growth that this acquisition will add to the CSL business.
Investment and Innovation
In 2021/22, CSL increased its investment into research
and development by 17% at constant currency.
Enduring organisations have many high-value capital
allocation options; initiatives to invest in that will help the
organisation prosper into the future. Optionality is a good
problem to have, and one that our leadership group
debates regularly.
While these can take years to realise, it is great to share the
achievement when we do. One recent example was the
completion of the US$156 million expansion of our CSL Seqirus
manufacturing facility in Holly Springs, North Carolina in the
US. This new fill and finish production line gives us the ability
to streamline our production process more efficiently, which
ultimately helps us to better meet the needs of our patients
and, in turn, better meet the needs of public health. CSL
Seqirus’ new A$800+ million cell culture vaccine production
facility in Tullamarine is also making good progress and when
finished (expected to be in 2026) will be the only one of its kind
in the Southern Hemisphere.
Our R&D pipeline is at the heart of future therapies and
our investment in our R&D infrastructure is significant.
Construction of our new R&D campus in Marburg,
Germany, is nearly complete and this building will have
capacity to house about 500 R&D employees, who will
form strong, collaborative linkages with our other R&D
campuses around the world.
In Melbourne, Australia, our state-of-the-art global R&D
campus and new corporate headquarters under construction
in Parkville’s biomedical precinct are well advanced, with
plans for completion in early 2023.
We have also made good progress in our investment into
our late-stage R&D pipeline. In May, we received notice
that the US Food and Drug Administration had accepted
our Biologics License Application, for priority review, for
the promising gene therapy etranacogene dezaparvovec.
In clinical trials, etranacogene dezaparvovec has been
shown to significantly reduce the rate of annual bleeds
in people with haemophilia B after a single, one-time
infusion compared to when these people were receiving
recombinant factor IX therapy alone. If approved, it would
be the first ever gene therapy treatment option for the
haemophilia B community. This is a great development,
and we are excited about the prospect of launching new
and innovative products over the coming years.
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Another example of a valuable investment relates to
improving our donors’ experience when they visit our centres.
Plasma donors are a fundamental part of our business, and
without them patients would not have access to life-changing
medicines. In order to optimise their experience in our centres,
we are employing a new plasmapheresis platform utilising
technology to support a safe, efficient and improved experience
for plasma donors, as well as a better process for CSL Plasma
employees. We will introduce this new technology across our
300 US centres in the future.
A Promising Future
In closing, I would like to thank our people, shareholders,
partners, plasma donors and the many other stakeholders
who allow us to bring people and science together
to execute on our strategy. This combination helps us
to achieve our purpose, which is to develop and deliver
innovative medicines that help people with serious and
life-threatening conditions live full lives and protect the
health of communities around the world.
While we are not immune to the macroeconomic
environment, I can assure you we will continue
to operate with resilience, integrity and agility
and deliver sustainable growth
Paul Perreault
CEO and MD
Acquisition of Vifor Pharma
We recently announced the acquisition of Vifor Pharma
(Vifor), a leading Swiss based company.
Vifor has a world-leading iron replacement platform
for treatment of diseases such as iron deficiency
anaemia and continues to generate extensive clinical
data in related areas of high unmet medical need,
such as iron deficiency in heart failure and patient
blood management.
Through its extensive dialysis portfolio, Vifor has built
a strong presence in renal diseases which continues
to benefit from the introduction of novel therapies
impacting disease progression.
A cornerstone of Vifor’s growth strategy has been
its strategic partnerships, which have allowed
Vifor to both broaden its portfolio and provide
patients access to the treatments they need.
The Vifor business enhances CSL’s established
focus on protecting the health of patients with
a range of rare and serious medical conditions.
Some of the strategic benefits of CSL’s
acquisition of Vifor include:
• Strengthening CSL’s Value driven strategy:
Vifor adds a durable and growing
business with leadership positions across
complementary and adjacent franchises,
delivering greater benefit to patients.
• Combined with CSL’s R&D capabilities and financial
scale, it enables a significant renal disease franchise
to be established in this large and growing market.
• Extends the reach of CSL’s high value pipeline: Together,
CSL and Vifor will have a complementary portfolio and
enhanced access to unique patient populations for
future clinical studies.
We look forward to aligning the rebrand of Vifor to CSL
Vifor and integrating the business within CSL’s
organisational structure and our 2030 Strategy.
CSL’s 2030 strategy with Vifor
E fficiency &
R e l iable Supply
• Technology
• Operational
Excellence
• Capital Project
Execution
• Partnerships
v
o
n
In
n
a ti o
• Products
• Delivery
• Services
• Technology
• Yield
Sustain
a
ble
G
r
o
w
t
h
• Plasma
• Recombinants
• Cell and Gene Therapy
• Influenza Vaccines
• Iron Therapy
s
u
c
o
F
• Immunology
• Haematology
• Transplant
• Respiratory
• Cardiovascular
and Metabolic
• Influenza
• Nephrology/Dialysis
S
C
L P e ople & Cultu
r
e
Patients and
Public Health
• Business
Model
• Connected
Healthcare
• New
Capabilities
D
i
g
i
t
a
l
T
r
a
n
s
f
o
r
m
a
t
i
o
n
55
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22
1 Chair and CEO Message
Our Values
CSL’s strong
commitment to living
our values has guided
us for many decades.
Our values are
fundamental to our
success – helping us
to save lives, protect
the health of people
and earn our reputation
as a trusted and reliable
global leader. They
are at the core of how
our employees interact
with each other,
make decisions and
solve problems.
66
Patient focus
Innovation
Integrity
Collaboration
Superior
performance
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Focus
Danielle's
story
Danielle is
leading a
fulfilling life.
With the pending arrival of twins and a newly earned master’s degree
in hand, Danielle is leading a fulfilling life. As a rare disease patient,
however, it wasn’t always an easy path to where she is now.
Danielle is living with common variable immunodeficiency, which is one
of hundreds of primary immunodeficiency (PI) conditions. People living
with a PI are especially vulnerable to infections. It took Danielle about
10 years to get the right diagnosis.
Now that she’s managing her condition with the right treatment,
Danielle is paying it forward by mentoring other PI patients and showing
them how it’s possible to live the life they’ve always envisioned.
7
CSL Limited Annual Report 2021/22 2 Our Company
CSL at a glance
Our businesses
40+
Countries of operations
around the world
30,000+
employees around
the world
US$10.6
billion in annual
revenue
2,000+
R&D employees
US$4.6
billion in R&D
investments in the
last 5 years to advance
product pipeline
330
Plasma collection
centres across
China, Europe and
North America
CSL Behring
CSL Behring is a global biotherapeutics leader driven
by our promise to save lives. Focused on serving
patients’ needs by using the latest technologies,
we discover, develop and deliver innovative therapies
for people living with conditions in the immunology,
haematology, cardiovascular and metabolic, respiratory,
and transplant therapeutic areas. We use three strategic
scientific platforms of plasma fractionation, recombinant
protein technology, and cell and gene therapy to
support continued innovation and continually refine
ways in which products can address unmet medical
needs and help patients’ lead full lives.
CSL Behring operates one of the world’s largest plasma
collection networks CSL Plasma.
CSL Seqirus
As one of the leading influenza vaccine providers
in the world, CSL Seqirus is a major contributor to the
prevention of influenza globally and a transcontinental
partner in pandemic preparedness.
CSL Seqirus operates state-of-the-art production
facilities in the United States (US), the United Kingdom
(UK) and Australia and utilises both egg-based and
cell-based manufacturing technologies as well as
a proprietary adjuvant. It has leading research and
development (R&D) capabilities, a broad and
differentiated product portfolio and commercial
operations in more than 20 countries.
88
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 99
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 2 Our Company
Our R&D Pipeline
Our research and development pipeline
CSL’s world-class R&D organisation continues to evolve as
a biotechnology leader by advancing high-quality science
and technologies developed by our own high-calibre
scientists and innovative collaborations. R&D utilises its
expertise in our strategic platforms – plasma fractionation;
recombinant protein technology; cell and gene therapy;
and vaccines technology. This ensures CSL can develop
and deliver innovative medicines and vaccines that address
unmet medical needs, help prevent infectious disease
and protect public health, and help patients lead full lives.
CSL’s strong R&D pipeline includes new treatments that
utilise these platforms and align with its leading-edge
scientific technology and commercial capabilities across
our six therapeutic areas: immunology; haematology;
cardiovascular and metabolic; respiratory; transplant;
and influenza vaccines.
In 2021/22 CSL invested US$1.16 billion* in R&D across our
businesses. Looking towards 2030, R&D continues to strive
to deliver on the current portfolio of medicines and vaccines
and build a full and innovative pipeline that will make
a meaningful difference to the lives of patients with rare
and serious diseases. This pipeline is expected to contribute
new revenue streams well into the following decades.
*Limited assurance by Ernst & Young
1010
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Global Research and Development Pipeline 2021/22
Immunology
Clinical
Registration
Post-Launch
HAEGARDA® (C1 Esterase Inhibitor subcutaneous) Hereditary Angioedema
HIZENTRA® (20% subcutaneous Ig) Multiple Indications
PRIVIGEN® (10% intravenous Ig) Multiple Indications
Garadacimab (Anti-FXIIa mAb) Hereditary Angioedema
HIZENTRA® (20% subcutaneous Ig) Dermatomyositis
HIZENTRA® (20% subcutaneous Ig) Systemic Sclerosis
CSL324 (Anti-G-CSFR mAb) Hidradenitis Suppurativa
CSL730 (Recombinant Trivalent Human IgG1 Fc Multimer)
Multiple Indications*
Haematology
Clinical
Registration
Post-Launch
AFSTYLA® (Recombinant FVIII) Haemophilia A
IDELVION® (Recombinant rFIX-FP) Haemophilia B
Etranacogene dezaparvovec (Recombinant adeno-associated viral
vector with codon-optimized Padua derivative of Human FIX cDNA)
Haemophilia B
KCENTRA® (Prothrombin Complex Concentrate) Trauma
CSL889 (Hemopexin) Sickle Cell Disease
Respiratory
Clinical
Registration
Post-Launch
ZEMAIRA®/RESPREEZA® (Alpha 1 Antitrypsin) AAT Deficiency
Garadacimab (Anti-FXIIa mAb) Interstitial Lung Disease/Idiopathic
Pulmonary Fibrosis
Trabikibart (Anti-Beta Common mAb) Asthma
CSL787 (Nebulised Ig) Non-Cystic Fibrosis Bronchiectasis
Cardiovascular and Metabolic
Clinical
Registration
Post-Launch
CSL112 [Apolipoprotein A-I (human)] Acute Coronary Syndrome
CSL346 (Anti-VEGFB mAb) Diabetic Kidney Disease
Transplant
Clinical
Registration
Post-Launch
Clazakizumab (Anti-IL-6 mAb) Chronic Active Antibody-Mediated Rejection
CSL964 (Alpha 1 Antitrypsin) Prevention of Graft-versus-Host Disease
CSL964 (Alpha 1 Antitrypsin) Treatment of Graft-versus-Host Disease*
Influenza Vaccines
Clinical
Registration
Post-Launch
AUDENZ™ (Adjuvanted Cell-based Pandemic Vaccine) Influenza A (H5N1)
FLUAD® (Trivalent Adjuvanted Vaccine) Influenza
FLUAD® (Quadrivalent Adjuvanted Vaccine) Influenza
FLUCELVAX® (Quadrivalent Cell-based Vaccine) Influenza
FOCLIVIA®/FOCETRIA (Adjuvanted Egg-based Pandemic Vaccine)
Influenza A (H5N1)
aQIVc (Adjuvanted Quadrivalent Cell-based Vaccine) Influenza
Outlicensed Programs
Clinical
Registration
Post-Launch
Eblasakimab (Anti-IL-13R mAb) Atopic Dermatitis
Mavrilimumab (Anti-GM-CSFR mAb) Giant Cell Arteritis,
Rheumatoid Arthritis**
* Partnered Project
** Mavrilimumab Phase II studies in GCA & RA complete. Kinikska evaluating development in rare cardiovascular diseases.
CSL’s pipeline also includes Life Cycle Management projects that address regulatory post-marketing commitments, pathogen safety, capacity
expansions, yield improvements, and new packages and sizes.
1111
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 2 Our Company
Our Product Portfolio
CSL Behring
Respiratory
We meet patients’ needs using the latest recombinant
and plasma-derived technologies. CSL Behring discovers,
develops and delivers the broadest range of products
in the industry for treating rare and serious diseases such
as haemophilia, von Willebrand disease (vWD), primary
immune deficiencies (PID), chronic inflammatory
demyelinating polyneuropathy (CIDP), hereditary
angioedema (HAE) and inherited respiratory disease.
CSL Behring’s products are also used in cardiac surgery,
for burns treatment and for urgent warfarin reversal.
Immunology
Our world leading immunoglobulin franchise is the
cornerstone of the immunology therapeutic area.
Key CSL Behring products in market include PRIVIGEN®,
HIZENTRA®, BERINERT®, HAEGARDA® and a range
of hyperimmunes.
Haematology
We are focused on maximising the value of our existing
portfolio, developing new therapies and identifying
transformational treatments to help patients realise
a life full of potential.
Key CSL Behring products in market include IDELVION®,
AFSTYLA®, HUMATE P®/HAEMATE®, BERIPLEX®/KCENTRA®,
VONCENTO®/BIOSTATE® and albumin.
Cardiovascular and metabolic
We are focused on improving and extending the lives
of patients with cardiovascular disease (CVD) and diabetic
kidney disease.
Respiratory diseases impose an enormous burden
on patients and society and are a leading cause of death
and disability worldwide.
Key CSL Behring products in market include
ZEMAIRA®/RESPREEZA®.
Transplant
While advances in transplantation techniques and therapies
have markedly improved short-term patient survival,
transplant rejection remains one of the greatest limitations
to long-term graft and patient survival for both solid organ
and haematopoietic stem cell transplant recipients.
We are focused on developing therapies to address
transplant rejection.
CSL Seqirus
Our broad range of influenza vaccines meets the needs
of different populations around the world. In Australia and
New Zealand, CSL Seqirus is a leading provider of in-licensed
vaccines and specialty pharmaceuticals. It is also the world’s
only supplier of a unique range of products made in the
national interest for the Australian Government, including
antivenoms and Q fever vaccine.
Influenza Vaccines
Egg-based and cell-based products, seasonal, pre-pandemic
and pandemic influenza vaccines.
Products of National Significance
Q fever vaccine and antivenoms for venomous creatures
in Australia and other Pacific countries.
In-licensed Vaccines and Pharmaceuticals
For Australia and New Zealand.
1212
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Operating Review
CSL Behring
Total revenue was US$8,598 million, up 2%1 when compared
to the prior comparable period.
Immunoglobulin (Ig) product sales of US$4,024 million,
were down 3%1 as supply was constrained by the lower
plasma collected in the previous year.
Despite the challenging environment, HIZENTRA® (Immune
Globulin Subcutaneous (Human), 20% Liquid) sales were
steady due to the preference for home administration and
the continued uptake for HIZENTRA® for the treatment of
Chronic Inflammatory Demyelinating Polyneuropathy (CIDP),
a debilitating neurological disorder.
PRIVIGEN® (Immune Globulin Intravenous (Human),
10% Liquid) declined modestly, impacted by supply
constraints and the patient preference for HIZENTRA®.
Underlying demand for Ig continues to be robust due
to significant patient needs in core indications – namely
Primary Immune Deficiency, Secondary Immune
Deficiency and CIDP.
Specialty product sales of US$1,792 million, up 3%1 led
predominately by demand for KCENTRA® and to a lesser
extent HAEGARDA®.
KCENTRA® (4 factor prothrombin complex concentrate)
recorded sales growth of 18%1, as hospital demand for
the product returned to pre-pandemic levels driven by
penetration within large hospitals and expansion into
smaller regional accounts.
HAEGARDA®, a therapy for patients with hereditary
angioedema, grew by 5%1, driven by continued patient
growth and a continued shift from on-demand to
prophylaxis treatment. New launches in Europe and
Australia have contributed to the rise in patient numbers.
Growth in the specialty portfolio was offset by lower wound
healing product sales in Japan and a decline in ZEMAIRA®
(alpha-1-proteinase inhibitor) following supply interruptions
at our Kankakee facility in the US.
Haemophilia product sales of US$1,166 million increased 8%1.
IDELVION®, CSL Behring’s novel long-acting recombinant
factor IX product, achieved strong growth of 20%1 driven by
its clinical profile that continues to attract patient demand
and gain market share. It remains the market leader for the
treatment of haemophilia B patients.
The haemophilia A market has been competitive resulting
in sales declines for AFSTYLA®, a novel recombinant factor
VIII product, and plasma-derived products.
Albumin sales of US$1,072 million, were down 1%1. Sales in
China were up strongly whereas sales in other major market
such as the US and Europe declined modestly due to the
supply constraints from the lower plasma collections in the
previous year.
Plasma collections
Whilst plasma collections were adversely impacted by the
COVID-19 pandemic in the previous financial year, this year
saw strong growth with plasma volumes collected up 24%.
This was the result of targeted marketing efforts and
enhanced digital initiatives to attract donors.
The cost of collections also increased including donor
compensation and labour.
CSL Seqirus
Total revenue of $1,964 million, was up 13%1 driven by growth
in seasonal influenza vaccines and CSL Seqirus’ differentiated
high value products, in particular FLUAD®, the adjuvanted
product for the elderly market.
1 Constant Currency removes the impact of exchange rate movements to facilitate comparability of operational performance for the Group.
This is done in three parts: a) by converting the current year net profit of entities in the group that have reporting currencies other than US
Dollars, at the rates that were applicable to the prior comparable period (Translation Currency Effect); b) by restating material transactions
booked by the group that are impacted by exchange rate movements at the rate that would have applied to the transaction if it had occurred
in the prior comparable period (Transaction Currency Effect); and c) by adjusting for current year foreign currency gains and losses (Foreign
Currency Effect). The sum of translation currency effect, transaction currency effect and foreign currency effect is the amount by which reported
net profit is adjusted to calculate the result at constant currency.
1313
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 2 Our Company
Our locations
Marburg Germany
Goettingen Hattersheim Schwalmstadt
Germany
Amsterdam Netherlands
Liverpool UK
Maidenhead UK
Basel Switzerland
Bern
Switzerland
Tokyo Japan
Wuhan China
Hong Kong China
Melbourne Australia
Group Head Office
Sydney Australia
Indianapolis US
Kankakee US
Pasadena US
Mesquite US
Cambridge US
King of Prussia US
Holly Springs US
Knoxville US
Boca Raton US
Research and Development
Manufacturing
Commercial Operations
Testing Laboratory
Logistics Centre
Distribution
Warehousing
Administration
Regional Sales and/or Distribution
Plasma collection centres
Less than 50 centres
More than 300 centres
1414
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Efficiency and
reliable supply
15
CSL Limited Annual Report 2021/22 3 Our Performance and Strategy
Business performance highlights
Focus
• Remained focused on delivering on our promise to patients and public health
during an unprecedented time of uncertainty.
• US$17.8 million supporting product access across the world.*
• US$50 million in global community investment across our strategic areas of support.
Innovation
Efficiency
and reliable
supply
• Research and development (R&D) investment of US$1.16 billion.*
• Etranacogene dezaparvovec (Haemophilia B gene therapy) primary end point
achieved in HOPE-B study with MAA (EU) and BLA (US) submitted.
• Garadacimab Phase III study enrolment completed for HAE.
• CSL112 (currently in Phase III for cardiovascular disease) continues to progress
with over 80% enrolment.
• Phase II study for an adjuvanted QIV cell-based influenza vaccine completed.
• Government funding for new biotech start-up incubator partnership between CSL,
WEHI and University of Melbourne.
• Achieved 24 product registrations or new indications across the globe.
• Ongoing investment in major capital projects at all manufacturing sites to support
future growth.
• In 2021/22, 27 new plasma collection centres opened.
• New plasmapheresis platform approved.
• Participated in 406 regulatory inspections of our manufacturing facilities and
plasma collection centres.*
• 135 million influenza vaccine doses distributed by CSL Seqirus.
• Fill and finish capacity expansion projects completed at Holly Springs and Liverpool
for influenza vaccines.
Sustainable
growth
• Revenue up 3% at constant currency.
• Significant growth in plasma collections.
• Strong performance by HIZENTRA®, our market leading subcutaneous
immunoglobulin product with sales up 20%.
• KCENTRA®, our peri-operative bleeding product, grew 18% as hospital demand
returned to pre-pandemic levels.
• CSL Seqirus revenue up 13% at constant currency driven by strong growth in
seasonal influenza vaccines and product differentiation.
• US$9.9 billion distributed in supplier payments, employee wages and benefits,
shareholder returns, government taxes and community contributions.*
• Announced Science Based Targets initiative aligned emissions reduction targets.
Digital
transformation
• Enhanced CSL Plasma Donor App with new functionality.
• Progression of the converged enterprise network strategy across the organisation.
• Initiation of our next generation Donation Management System.
People and
culture
• Achieved 77.9% employee engagement* score, an increase on the previous year.
• 44% female representation at Board level, 61% female across the Group.*
• Established early career programs for STEM talent around the globe to build our
future talent pipeline.
• CSL named among America’s best employers by Forbes magazine and also
recognized as one of Australia and New Zealand’s Best Places to Work by
The Australian Financial Review.
Patients and Public Health underpin everything we do
* Limited assurance by Ernst & Young.
1616
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Financial Highlights & Reported Results
Interim unfranked dividend of
Final 10% franked dividend of
US$1.04
per share
+
US$1.18
per share1
=
Total ordinary dividends for 2022
US$2.22
per share
CSL announced a net profit after tax of
US$2.255 billion
for the 12 months ending 30 June 2022
Net profit after tax at
constant currency2 declined
6%
Sales revenue was
US$10,136 million
Expense performance
• Research and development (R&D) expenses were US$1,156 million, up 17%2 when compared to the prior comparable period.
The increase in expenses reflect further progression of our R&D projects since the easing of COVID-19 restrictions.
• Selling and marketing expenses (S&M) were steady2 at US$961 million in comparison to the previous year. Whilst we had
additional expenses on Etranacogene dezaparvovec pre-launch activities, we managed to hold S&M expenses in-line
with prior year.
• General and administrative (G&A) expenses were US$688 million, an increase of 4%2 when compared to the prior comparable
period. The increase in G&A expenses were largely related to costs associated with acquiring Vifor. Excluding Vifor acquisition
costs, G&A expenses were lower than prior year.
• Depreciation, amortisation (D&A) expense and impairment was US$668 million, up 14%2 in comparison to the prior
comparable period. D&A has increased due to continued commissioning of major capital and IT projects.
• Net finance costs were US$148 million, down 4%2. The decrease in net finance costs were predominantly related to an
increase in finance income, largely driven by higher interest rates and operating cash balances inclusive of the equity
proceeds related to the acquisition of Vifor.
Financial position
• Cashflow from operations was US$2,629 million, down 27%. This reflects lower profit before tax and significant increase
in inventories driven by higher plasma costs per litre and improved plasma volumes collected.
• Cashflow used for investing was US$1,636 million, down 2% when compared to the prior comparable period, predominantly
driven by lower capital spend.
• CSL’s balance sheet remains in a strong position with net assets of US$14,578 million.
• Current assets increased by 123% to US$16,461 million. The main driver was from strong cash inflows from operations
as well as equity and debt proceeds related to the acquisition of Vifor.
• Non-current assets increased by 10% to US$11,885 million in comparison to the previous year. The increase is mainly due
to continued capital project spend, new right of use assets relating to leases of new facilities together with the on market
acquisition of a minority of Vifor shares.
• Current liabilities increased by 129% to US$7,108 million. The significant increase is mostly related to debt finance raised for
the Vifor acquisition, which was treated as a current liability at 30 June due to a redemption feature should the deal not have
completed. Following the subsequent completion of the Vifor acquisition, the related debt will be classified as non-current
from the date of completion with the redemption feature now being met.
• Non-current liabilities were steady at $6,660 million compared to last financial year. Increase in deferred tax liabilities
were mostly offset by lower non-current interest-bearing liabilities and borrowings coupled with decrease in retirement
benefit liabilities.
1 For shareholders with an Australian registered address, the final dividend of US$1.18 per share (approximately A$1.68) will be franked to 10%
for Australian tax purposes and paid on 5 October 2022. For shareholders with a New Zealand registered address, the dividend of US$1.18 per
share (approximately NZ$1.86) will be paid on 5 October 2022. The exchange rates will be fixed at the record date of 7 September 2022.
All other shareholders will be paid in US$. CSL also offers shareholders the opportunity to receive dividend payments in US$ by direct credit
to a US bank account.
2 Constant Currency removes the impact of exchange rate movements to facilitate comparability of operational performance for the Group.
This is done in three parts: a) by converting the current year net profit of entities in the group that have reporting currencies other than US
Dollars, at the rates that were applicable to the prior comparable period (Translation Currency Effect); b) by restating material transactions
booked by the group that are impacted by exchange rate movements at the rate that would have applied to the transaction if it had occurred
in the prior comparable period (Transaction Currency Effect); and c) by adjusting for current year foreign currency gains and losses (Foreign
Currency Effect). The sum of translation currency effect, transaction currency effect and foreign currency effect is the amount by which
reported net profit is adjusted to calculate the result at constant currency.
1717
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 3 Our Performance and Strategy
Our Value Creation Chain
Unmet need
Opportunities to improve and protect
the quality of life of patients and
communities in therapy areas we treat.
Natural resources
Includes: plasma donations for rare
and serious diseases; influenza virus
strains for product manufacture; and
environmental inputs such as water
and energy.
What we depend on
Physical assets
Plasma centres to collect raw material,
manufacturing facilities for our products,
warehouses, offices for our people and
laboratories for our scientists.
Our people
30,000+ people with diverse skills that
are driven by our purpose and values.
CSL’s Strategy
Financial resources
Cash, equity and debt for future growth.
Collaborators and business partners
Accessing and sharing intellectual know
how to develop and innovate
our products.
L P e o ple & Cultu
r
e
S
C
Patients and
Public Health
Our expertise and operations
Sourcing
including plasma collection
Pharmacovigilance
Strategic Sustainability
Pillars & Focus Areas
Environment
Social
Workforce
Early stage research
& collaboration
Product development
& clinical trials
Manufacturing
& distribution
Sales, marketing, policy
advocacy & patient support
CSL’s Purpose, Values and Code of Responsible Business Practice
A healthier more productive society
Protecting global health and the wellbeing
of individuals, families, businesses and
communities from life-threatening and/or
complications resulting from influenza.
Saving and/or improving the quality of life
of hundreds and thousands of people with
rare and serious diseases.
Value we create
Sustainable financial growth
Delivering consistent, profitable
and responsible growth for our
investors, which fuels innovation
and development.
Social and economic opportunity
Enabling hundreds of thousands of
people to benefit from opportunity
created by growing along with us,
including employees, suppliers, plasma
donors and research partners.
Our promise to patients
1818
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Our 2030 Strategy
CSL is driving sustainable growth to bring lifesaving therapies to patients and protect public
health across the globe. We are focused on delivering across our therapeutic areas through
innovation and our tireless approach to efficiency and reliable supply.
CSL’s 2030 Strategy has been developed to maximise our
capabilities and advantages in a competitive and constantly
changing world. Historically and to this day, we are
continuously innovating to increase efficiencies in our supply
chain with plasma collections to finished product for our
plasma-derived protein therapeutics – a business that has
grown sustainably over the years, is difficult to replicate and
does not face patent cliffs. Our differentiated cell-based and
adjuvanted influenza products offer communities improved
protection against influenza, and our extensive experience
in rare disease allows us to focus on patients in our core
therapeutic areas, delivering next-generation innovative
products across multiple platforms.
Our strategic pillars are represented in the Our 2030 Strategy
(with Vifor) graphic on page 5. We focus on supporting
patients and global public health in our core therapeutic
areas. Our sustained investment in innovation, with an R&D
budget of around US$1 billion, allows us the resources to
develop the next generation of products to serve patients
and public health. We are driven to be a leader in our fields
of expertise and deliver a reliable supply of our lifesaving
therapies. For sustainable growth of the enterprise, we are
committed to serving our populations with the best available
therapy across our strategic scientific platforms – plasma
fractionation, recombinant protein technology, cell and
gene therapy and vaccines. We see the promise of digital
transformation to drive efficiency in our business and
innovation to patients. At the centre of it all, we are investing
in the more than 30,000 people who make up CSL, while
remaining environmentally responsible as part of our
sustainability strategy.
Driving Sustainable Growth of Our Core Platforms
Plasma-derived therapies rely on plasma collections from
donors to manufacture lifesaving products at our sites
around the world. While the pandemic disrupted collections,
we continued to invest in centre openings, operational
improvements and digital engagement to donors through
our CSL Plasma app to drive our sustainable growth path
as conditions become more favorable. Today, collection
volumes are exceeding our pre-pandemic levels.
As plasma collection volumes increase, we continue our
investment in efforts to increase the yield of proteins
recovered from each litre of plasma. Our commitment to
innovation and our end-to-end network approach allow
us to look at new ways to recover as much lifesaving protein
as possible, from systematic process improvements through
to highly innovative, transformative technologies.
CSL’s core plasma products have a long history of being safe
and effective. We continue to explore the potential benefits
of our existing products in new indications to expand the
number of patients that can benefit. We are also looking at
new products derived from plasma, such as CSL112, which
has the potential to be another important, lifesaving product
and drive sustainable growth for the enterprise.
CSL Seqirus distributed a record number of vaccine doses
in the last year, reflecting the public health benefits of our
innovative influenza vaccines product portfolio.
We also continue to invest in the capabilities needed to drive
sustainable growth, including commercial, R&D, medical and
government affairs, which are critical to driving recognition
of the benefits of our differentiated vaccine technologies.
We are taking a pioneering role in innovation, leveraging
our cell, adjuvant and self-amplifying mRNA (sa-mRNA)
technologies. Several of our products have been recognised
by achieving preferred recommendations from National
Immunisation Technical Advisory Groups.
To support future growth in vaccines, we are also investing
in new manufacturing capabilities, including recently
completed fill and finish expansions in Liverpool, UK,
and Holly Springs, North Carolina, US, and ongoing work
at our new cell-based manufacturing facility in Tullamarine,
Australia, which is expected to commence commercial
vaccine production in 2026.
Disruptive R&D Innovation to Better Meet
the Needs of Patients and Public Health
We are committed to serving patients and public health
within our therapeutic areas by developing novel
therapeutics and vaccines using our plasma fractionation,
recombinant protein technology, cell and gene therapy
and vaccines platforms.
Today, we have a single, integrated R&D portfolio
encompassing all programs across multiple therapeutic
areas and scientific platforms, providing strong foundations
for sustainable growth.
Bringing together and integrating resources in our R&D
functions allows us to share capabilities when possible and
to enrich collaboration in functions where capabilities remain
separate. The integrated portfolios, scientific synergies and
complementary mindset will serve to build an even more
robust pipeline and future for CSL. There are already
numerous success stories of teams joining forces to solve
challenging problems.
Our focus on patients and innovation has delivered novel
products like our class-leading recombinant factor IX
albumin fusion protein, IDELVION®, for the treatment of
haemophilia B. IDELVION® is the most trusted brand in the
haemophilia B space and we continue to deliver for patients
with the promising etranacogene dezaparvovec, a gene
therapy with transformative potential to the lives of
haemophilia B patients.
1919
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 3 Our Performance and Strategy
Beyond haemophilia, we continue to develop promising
products for patients with other diseases such as hereditary
angioedema (HAE). While HAEGARDA® results in near-
elimination of HAE attacks for patients, garadacimab –
our anti-factor XIIa monoclonal antibody in late stage
development has the potential to provide patients with
similar control with less frequent dosing and easier
administration. Other products in development include
CSL112, our human apolipoprotein A-I product to reduce
the risk of recurrent cardiovascular events during the
90-day high-risk period following a heart attack, and
planning for a global Phase III study to evaluate the early
administration of KCENTRA® (4-factor prothrombin complex
concentrate) on survival in trauma patients suffering
life-threatening bleeding.
We are also investing in new vaccine technologies to protect
the public health, including next generation technologies
such as sa-mRNA and aQIVc.
These are just some examples of how CSL’s R&D team seeks
to disrupt the status quo and explore better options for
patients, including the potential benefits of our existing
products in new indications.
Our Digital Transformation
Technology is pushing us forward. Advances in analytics
and automation are accelerating our path to sustainable
growth. This acceleration is also extending the value of
digital transformation from productivity of our processes
and people, to new ways of keeping our promise to patients.
In the core of our business, analytics and automation are
enhancing the plasma donor experience, improving yield
in the supply chain, and facilitating customer-centricity.
Supporting this is analytics and automation, these support
the rate of experimentation in biomedical discovery,
differentiate our therapies through observational and
real-world evidence, and guide our patients through the
complexity of care.
Going forward, we expect more change. Real world
observations are likely to lead to clinical decision
support algorithms for insights at the point of care.
Yield improvements are likely to lead to digital twinning
of our supply chain. Patient engagement is likely to
lead to decentralised clinical trials.
Underlying our digital transformation is an effort to
modernise our technology backbone to further enhance
reliability and security. The renewed foundation also
operates as a platform for a better workplace experience
and an increasing rate of digital innovation.
Advancing Promising Futures for Our People
CSL’s sustained success and the lives of the patients
we serve rely on the more than 30,000 people who make
up CSL around the world. Investing in our people is an
enterprise-wide priority, and we have a variety of initiatives
in place to ensure we attract, develop, reward and retain
the best talent across the globe.
At CSL, we believe our people can enjoy promising futures
where they fulfill their individual career aspirations and
potential and are inspired by a purpose-driven company
with a values-based culture.
At every level of the organisation, we focus on:
• enabling career development across the enterprise
with special attention to front-line leaders;
• establishing succession plans to support a robust
leadership pipeline now and in the future;
• enhancing CSL’s culture by listening to our employees
and key stakeholders and making improvements to
the employee and patient experience; and
• embedding diversity, equity and inclusion in all aspects
of our business – from planning to decision making – and
ensuring we have an engaging culture and workplace.
2020
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Our Sustainability Strategy
To foster a more sustainable future, we announced our sustainability strategy in August 2021, focussing on three strategic
pillars – Environment, Social and Sustainable Workforce. We have identified these three strategic pillars as material to our
business where we plan to increase our engagement and accelerate action over the medium- to long-term. Performance
across our strategic pillars will support execution of our 2030 Strategy and our promise to improve the lives of patients and
protect public health. Our pillar focus areas are further guided by our material topics, which inform continuous improvement
across our operations and transparency in areas that matter most to our key stakeholders.
Sustainability Framework
Our Vision
CSL is committed to a healthier world. Our vision is a sustainable future for our employees, communities, patients and donors,
inspired by innovative science and a values-driven culture
Environment
Social
Sustainable Workforce
Focus areas
• Integrate sustainability
considerations into
business decisions
• Being trusted by donors through
a focus on their experience and
wellbeing, and their communities
• Reduce carbon emissions
• Strengthen societal health through
• Minimise end to end production
of waste through removal,
reduction and recycling
• Reduction of carbon emissions/
waste in our supply chain
access to our existing products
and therapies and investment
in innovation
• Enhance our industry position
as a patient-focused and public
health leader
• Raise awareness, visibility and
engagement of sustainability across
the end-to-end working experience
for our employees
• Communicate to and engage
with employees in programs
that maximise diversity, equity
and inclusion
• Ensure all CSL employees have
access and opportunity to
participate in community giving
programs and volunteerism for
local needs
Material
topics*
Key SDGs
• Promoting environmental
• Product safety and quality
• Talent recruitment, development
protection
• Climate change and
climate resilience
• Energy and emissions
• Waste and packaging
For more see section 8
in this report.
• Supply continuity and resilience,
including human rights and
responsible supply chain^
and retention
• Health, safety and wellbeing
• Diversity, equity and inclusion
For more see section 7 in this report.
• Innovation and R&D
• Trust and transparency
• Health security
• Accessible and affordable
healthcare
For more see section 9
in this report.
CSL continues to be guided by the General Assembly of the United Nations (UN) 2030 Agenda for Sustainable
Development, which includes 17 Sustainable Development Goals (SDGs). The goals seek to address global
challenges, including those related to health and wellbeing, inequality, innovation and climate change.
For CSL, these goals continue to guide our actions and inform our 2030 and sustainability strategies, with four
being identified as key goals where our sustainability performance can positively influence their achievement.
More on SDGs on CSL.com (Our Company > Corporate Responsibility > Approach).
*Limited assurance by Ernst & Young
^ Human rights and responsible supply chain was identified as a material topic under Governance, but has been combined with supply
continuity and resilience. Ethics and integrity was the other material topic prioritised under Governance and detailed in section 10 of this
report. More on material topics can be found on CSL.com (Corporate Responsibility > Approach).
2121
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 3 Our Performance and Strategy
For the reporting year, our focus has been on advancing
progress across our environmental pillar. We have taken
necessary steps to understand the impacts of climate
change on key assets and in responding to the challenges
of a warming globe by delving deep into our operations
today and well into the future. We have developed emission
reduction targets across Value Chain. We are pleased to
announce new carbon emissions reductions targets that
will serve as a tangible, transparent roadmap to decarbonise
our operations by reducing our direct and indirect emissions
footprint. As such, in alignment with science-based targets,
we commit to a 40% reduction in absolute Scope 1 and
Scope 2 emissions by 2030, using the average of CSL’s
FY19-21 emissions as the basis. Further, we intend to ensure
that suppliers who contribute 67% of our Scope 3 emissions
have set Science Based Targets initiative aligned Scope 1
and 2 reductions by 2030.
We continue to progress other focus areas across our
other pillars, including access to our therapies, sustainable
workforce, employee engagement and diversity, equity
and inclusion, as detailed within this report.
In support of our efforts, an executive committee has been
established with several global executives as members. This
committee has hands-on responsibility for formulating and
achieving CSL’s sustainability goals. It will create a culture of
accountability across CSL. CSL’s Board of Directors will retain
oversight of progress through the Board and its Committees.
Climate change risk assessment
CSL has a practice of periodically conducting climate
change risk assessments. This year we concluded an
enterprise-wide risk assessment of our manufacturing
facilities, CSL Plasma operations and key warehouse
and third-party logistics infrastructure.
Our current view of the impact of climate change has
been factored into our financial reporting for the year
ended 30 June 2022. The impact assessment was
primarily focused on the valuation and useful lives of
intangible assets and the identification and valuation
of provisions and contingent liabilities, as these are
judged to be the key areas that could be impacted
by the current reasonably foreseeable climate risks.
No material accounting impacts or changes to
judgements or other required disclosures were noted.
While the Group’s assessment did not have a material
impact for the year ended 30 June 2022, this may
change in future periods as the Group regularly
updates its assessment of the impact of the lower
carbon economy.
2222
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Innovation
23
CSL Limited Annual Report 2021/22 4 Our Material Risks
CSL operates in a fast paced and constantly evolving environment of science, technology
and healthcare. We are exposed to risks inherent in the global biotechnology industry,
and in particular the plasma therapies and vaccine industries, which include research
and development, intellectual property and clinical trials.
We are also exposed more broadly to external risks such
as the COVID-19 pandemic and the Russia-Ukraine conflict
and we regularly review our group risk profile to proactively
identify material business risks and opportunities and assess
external risks that could affect our global operations.
Managing risks includes both the mitigation of disruptive
risks and the preparation for seizing opportunities. Our global
Enterprise Risk Management Framework is designed to
ensure robust risk oversight that is fit-for-purpose for both
the operation of our business and to support our strategy
and deliver on our commitments to patients and
public health.
As part of our enterprise risk management process, the
Board and management team have identified the key risks
that are material to CSL. These material group risks are
described below along with an explanation of our approach
to managing them in the context of delivering on our 2030
Strategy. Key financial risks are set out in Note 11 to the
Financial Statements.
There are other risks that are inherent in the vaccine,
pharmaceutical and plasma therapies industries, besides
those detailed below or in the Financial Statements, that
could also adversely affect CSL’s business and operations.
Patient safety and product quality
Patient safety is paramount for CSL’s ongoing sustainability
as a global biotechnology leader and our long-term strategy
of efficiency and reliable supply. When we talk about patient
safety, we mean both in the use and administration of
registered products as well as in the conduct of our clinical
trials. While it is inherent in our industry that patients
and trial participants may experience adverse reactions
to therapies, CSL’s manufacturing, product quality
assurance and pharmacovigilance practices serve to ensure
the highest standards of safety and the preservation of our
reputational integrity.
Our processes and procedures meet good pharmacovigilance
practice (GPV) and good clinical practice (GCP) standards
we seek to ensure that product information is up-to-date
and contains all relevant information to assist healthcare
practitioners to appropriately prescribe CSL products. For
clinical trials, participants are informed and acknowledge
awareness of the benefits and risks of participation in the
trial through use of Informed Consent Forms approved
by regulators.
In terms of meeting product quality requirements through
our manufacturing and supply, we adopt and comply with
a broad suite of internationally recognised standards through
the CSL Quality Management System, including good
manufacturing practice (GMP), good distribution practice
(GDP) and audits of third-party vendors and suppliers.
We are frequently inspected by independent regulatory
authorities auditing compliance with these standards.
Product innovation and competition
We recognise that an impediment to delivering on our
innovation and sustainable growth strategies is the changing
competitive landscape for new technologies and disruptive
therapies, such as cell and gene therapies. This material risk
may alter the economics and characteristics of, and the
demand for, CSL’s plasma and adjacent therapies, and
may also affect our platforms and capabilities in plasma
fractionation, recombinant technology, and cell and
gene therapy.
We strategically review our existing and future product
pipeline against market demand and continually evaluate
our competitive landscape. A key part of our strategy
includes diversity in our product pipeline, and focus on six
therapeutic areas (immunology, haematology, respiratory,
cardiovascular and metabolic, transplant, and influenza
vaccines). We incorporate product lifecycle development
and management, as well as development of new therapies,
in strategies for each therapeutic area. In addition to
proprietary research, CSL’s competitive approach includes
licensing, acquiring or partnering with third parties to remain
competitive and advance growth within our chosen
therapeutic areas.
With respect to continued growth and innovation in the
competitive global influenza vaccine market, we recognise
the need to continue leading in the development and
manufacture of influenza vaccines including cell-culture
technology and investigating the use of self-amplifying
mRNA technology. Failure to capitalise on innovative
technology will diminish growth in this product sector,
whereas success will deliver competitive advantages.
Supply, capacity and operations
Having a sustainable and reliable supply chain is critical
to the success of our 2030 Strategy, particularly to
achieving consistent, economical and efficient supply.
When considering this material risk, we constantly
monitor the demand for and supply of collecting and
acquiring human plasma.
We also monitor the scalability of specialised companies
who supply raw materials, software and bespoke
manufacturing equipment to match our business
demand and growth objectives.
Both plasma collection and raw material supply across our
businesses have been impacted by COVID-19, requiring us to
implement both immediate and continued risk mitigations
to manage this risk. Similarly, with the ongoing Russia
Ukraine conflict, the EU energy crisis continues to escalate.
Higher gas prices could affect all our sites and suppliers,
while gas supply constraints will mostly affect our EU
operations. Several mitigation actions have been identified
and contingency plans established to help prevent
disruption to our operations however the situation will
continue to be monitored as the conflict continues.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 In our US and European plasma collection centres, we utilise
modern techniques and technologies to facilitate the safest,
most efficient donation process. We consistently update our
plasma collection centres to seek to provide a comfortable
and safe donor experience. External sources of plasma may
be utilised as needed and available to supplement
collections to meet demand.
In addition to this, we recognise the evolution of our
workforce environment, including the challenges and
opportunities created by COVID-19. We have implemented
a flexible working environment for those workers at CSL
where it makes sense to do so. We constantly challenge
ourselves to create a work dynamic where our people
can focus on meaningful, valuable work.
As the cornerstone to our employee value proposition, we
have implemented an initiative called Promising Futures,
which emphasises digitalisation and automation, employee
development, collaboration and connectivity and customised
rewards for attracting next-generation talent.
Privacy and cybersecurity
Maintaining privacy and security of all data including that
of our patients, plasma donors, employees and company
data is critical. We continue to see a growing trend in
cyberthreats against individuals and companies. The nature
of these cyberattacks is constantly evolving and can include
sophisticated phishing scams and attacks on critical
infrastructure. Additionally, the privacy and security of the
data we hold may be compromised by breaches of our
information technology (IT) security and unauthorised or
inadvertent release of information through human error,
malware or espionage.
CSL continuously monitors and assesses its cybersecurity
threats. We have implemented robust and externally tested
security controls for our IT systems, infrastructure and data,
based on our understanding of known threats and best
practice industry knowledge. We also provide educational
updates and training so that our people can recognise and
properly respond to a cyberattack or report a privacy breach.
Further details about our enterprise risk management
framework and how we manage our business risks is provided
in our 2022 Corporate Governance Statement available
on CSL.com (Our Company > Corporate Governance).
We endeavour to invest in manufacturing capacity ahead
of projected demand to ensure that we can supply the needs
of patients. Our operations also accommodate investments
in technology and process improvements to enhance efficiency
and reduce costs. This includes improving immunoglobulin
protein yield from each litre of plasma, increasing throughput
of our existing facilities and pursuing the development of
new plasma-derived proteins for therapeutic use to further
improve the economic value of each litre of plasma. CSL
also seeks to develop non-plasma alternative therapies
to supplement patient needs.
Our end-to-end operations network strategy continually
evaluates short-, mid-, and long-term needs to inform
decisions on capital and operational expenditures, including
the use of expert third party providers to ensure a resilient,
reliable and sustainable supply chain. We examine and
prioritise our operational effectiveness efforts, capital plans,
inventory targets, supply chain visibility, distribution and
regulatory strategies to enhance the positions of our
products from a business continuity and supply chain
resilience standpoint.
Market access
Policy making around market access is a multi-stakeholder
engagement process, which includes governments, payers/
insurers, patient advocacy groups, medical societies and
non-governmental organisations. We recognise that if we
are not successful in maintaining an economic and reliable
supply of our therapies for our stakeholders, it may adversely
affect our ability to execute our strategy and to deliver
sustainable growth. In particular, we recognise that
macroeconomic pressures on pricing and payers (including
barrier taxes) may impair access, growth and new market
entries. We work closely with stakeholders in all markets
and continually seek to ensure pricing of our therapies
remains competitive in all markets. By striving to innovate
in our product portfolio, we can also expand our access
to competitive markets.
People and culture
Our people and our ability to maintain our desired culture are
integral to meeting and exceeding the standards expected
by our stakeholders and the community. We have a number
of programs and policies in place to ensure that our values
underlie how we do things including our Speak Up Policy
and our Code of Responsible Business Practice (CRBP).
We also recognise the need to have the right people in the
right roles in order to execute our 2030 Strategy. To attract,
develop and retain skilled and talented people in a globally
competitive environment, we review market practice,
and frequently benchmark ourselves against the markets
in which we operate to ensure we offer total rewards that
are both compelling and competitive with our peers
and competitors.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 5 Our Future Prospects
The fundamentals of CSL’s business, including our talented people, strong platforms
and leading products, position CSL to deliver growth over the long term.
Our commitment to patients and to deliver innovative
products is unwavering. As CSL looks ahead, the 2030
Strategy is designed to be resilient and allow us to better
serve our patients well into the future, providing a strong
platform for growth for shareholders.
We focus on life saving therapies for people with rare
diseases and on providing differentiated influenza vaccines
that protect the health of populations. The underlying
demand for our existing products in the core plasma,
recombinant and vaccine platforms is driven by expanding
markets and indications across geographies in each of our
six therapeutic areas.
The core plasma and influenza vaccines platforms have
advantages that position us for growth over the long term,
and provide competitive advantage over our peers. They
deliver products that are complex to make, and require
special skills that are not easily replicable. In addition, not
all of our products are subject to patent protection and
the subsequent revenue cliffs that can occur upon expiry.
This allows us to sustainably grow our core business’ across
therapeutic areas, platforms and geographies.
The future prospects of our core business depend on having
the right talent to execute our 2030 Strategy. As a purpose-
driven organisation, we are recognised as a great place to
work because of our culture and values. It takes a unique mix
of people to get the most out of our plasma business, grow
our vaccines footprint and innovate the next generation
of products.
Given these strong advantages in platforms, products and
people, the outlook for CSL is strengthening as we move
beyond the COVID-19 pandemic.
CSL’s platforms, products and people moving
us beyond COVID-19
• The COVID-19 pandemic has affected the industry’s ability
to collect plasma, which in turn has caused a tightness in
supply of the end products and constrained the industry’s
ability to fulfill patient demand.
• Our plasma collection volumes have recovered to their pre-
pandemic levels. Notwithstanding a long manufacturing
cycle (typically 9-12 months) we expect the tightness in
supply to alleviate throughout the rest of the calendar year.
• Continued investments over the last few years, including
expanding the collections network to over 300 centres and
the rollout of the new Terumo plasma collection device,
improve the donor experience and gives us a great position
to capture growth opportunities, particularly in our leading
HIZENTRA®/PRIVIGEN® immunoglobulin franchise.
• Over the past two years, we have experienced strong
demand for influenza vaccines as governments look to
protect their health systems and populations, and to avoid
a twindemic of COVID-19 and influenza. The demand
profile is likely to continue to be robust as stakeholders
recognise the benefits of population-level protection.
• The acquisition of Vifor, upon closing, broadens our base
with additional growth opportunities in iron replacement,
dialysis and nephrology.
Beyond our existing products, the R&D organisation is
developing a portfolio of novel products to drive the next
generation of growth. We are poised to launch our first
gene therapy product, etranacogene dezaparvovec for
haemophilia B, in the coming year and continue to develop
novel monoclonal antibodies as well as next-generation
technologies including aQIVc and sa-mRNA. In addition to
novel products, our R&D efforts include expanding markets
and indications for our existing products. These efforts
provide new areas of growth across our therapeutic areas.
Some examples are listed:
• In the near term our gene therapy candidate, etranacogene
dezaparvovec, is in the final stages of submission and
if approved, will transform how haemophilia B patients
are treated.
• In the mid-term we will endeavour to broaden our offering
to patients with hereditary angioedema to include our
recombinant monoclonal antibody, garadacimab.
• Over the longer term, we have a number of innovative
R&D programs in our pipeline such as CSL112, currently in
development and aimed at reducing the risk of recurrent
cardiovascular events.
Our focus on extending and improving the lives of patients
with rare and serious diseases has not wavered through the
COVID-19 pandemic. In the future we may face a new set
of challenges and opportunities that we must address
to position us for growth over the long-term.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 We expect some cost pressure due to inflation and other
supply chain factors. At the time of this writing, inflation
is the highest in decades due to supply chain uncertainty,
geopolitical challenges including the war in Ukraine and
other factors. While policy makers have signalled the priority
for fighting inflation, inflation could remain elevated for a
sustained period. Given the markets we serve, we aim to
grow sustainably through cost containment and productivity
measures, such as yield improvements.
We also expect significant competition from companies
manufacturing products similar to ours and the uncertain
impact of substitute products that are on the market or in
development. The entry of anti-FcRn products may also
represent a competitive threat, however demand for plasma
products, particularly immunoglobulin, is expected to
continue in the long-run driven by diagnosis of diseases such
as primary immunodeficiency disease (PID). In the near term
(3-5 years) immunomodulation indications where FcRns may
receive approval are not expected to be substitutes for our
immunoglobulin products. In addition, other competitors are
exploring the use of novel technologies, such as mRNA,
in the influenza vaccine space.
More information in relation to our outlook is provided
in our full year investor briefing presentation, and further
information on the factors that could affect our outlook
is provided in Our Material Risks on page 24.
Business strategies, prospects and
likely developments
This Operating and Financial Review (OFR) sets out
information on CSL’s business strategies and prospects
for future financial years, and refers to likely developments
in CSL’s operations and the expected results of those
operations. Information in the OFR is provided to enable
shareholders to make an informed assessment of the
business strategies and prospects for future financial years
of the CSL Group.
Certain information is excluded from the OFR (which
forms part of the Directors’ Report) on the basis that such
information relates to impending developments or matters
in the course of negotiation and disclosure would be
unreasonably prejudicial to the interests of CSL. Reasons that
could be considered unreasonably prejudicial to the interests
of CSL include providing information that is misleading due
to the fact it is premature or preliminary in nature, relates
to commercially sensitive contracts, would undermine the
confidentiality between CSL and contract counterparties, or
would otherwise unreasonably damage CSL. The categories
of information omitted include forward looking estimates
and projections prepared for internal management
purposes, information which is developing and susceptible
to change and information relating to commercial contracts
and pricing.
CSL Outlook
• Demand for CSL Behring’s core plasma products
is expected to remain robust. The significant growth
in plasma collections is expected to underpin strong
future sales of core plasma therapies.
• Product differentiation is expected to continue to drive
strong demand for CSL Seqirus’ influenza vaccines.
• The company anticipates a strong financial
performance and a return to growth in FY2023.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Sustainable
growth
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CSL Limited Annual Report 2021/22 6 Powered by Innovation
What stands CSL in good stead is our quantitative approach
to understanding the nature and biology of a disease at a
molecular and cellular level, married to a deep understanding
of the clinical and commercial aspects of those diseases
where we aim to introduce new innovative products.
CSL’s philosophy of global collaboration underpins our
presence within research precincts around the world. Strong
global research networks and collaborations are an integral
part of our global R&D business as they provide valuable
opportunities for our scientists to interact, discover and
innovate with external partners. We continue to identify and
expand our network of collaborators, both academic and
industry-based, to enrich external innovation and thinking.
Expanding our R&D footprint
CSL continues to advance its global programs and teams
and expand its R&D footprint. CSL has:
• 2,000+ R&D employees in nine countries, working
in integrated teams;
• R&D centres located in leading biomedical locations
including:
– Melbourne in Australia;
– Bern in Switzerland;
– Marburg in Germany;
– Amsterdam in the Netherlands; and
– Cambridge, Holly Springs, Pasadena and King of Prussia
in the US.
• access to worldwide, leading innovation that leverages
both the knowledge from CSL employees as well as from
research and medical institutions/alliances proximate
to CSL’s R&D centres.
The following are some notable examples of our investment
in our strategic growth over the last 12 months.
• Construction of CSL’s new global headquarters in the
Parkville Biomedical Precinct in Melbourne, Australia, is
on track for completion in early 2023. The base building
structure and facade are complete with internal fit-out
in progress. The facility will house around 800 employees,
including product development teams from throughout
CSL R&D, and include leading-edge laboratories along with
space for external collaborators, innovators and start-ups.
The facility is just 500m from the Bio21 Institute, where
CSL’s early stage research team has been based for over
10 years, and will further enable collaboration with other
researchers in this multidisciplinary biomedical precinct.
• The new R&D campus, in Marburg, Germany will open its
doors in September 2022 and will be the new home for
about 500 CSL R&D employees as well as hosting academic
partners and collaborators. The R&D campus is almost
40,000 square metres including 7,400 m2 of laboratory
space, 10,300 square metres of working space, a state of the
art vivarium and 905 m2 of collaborative laboratory space.
As one of the homes for our future innovation, innovative
sustainability was at the forefront of our mind when we
designed the building. It was constructed according to
KfW (a German state-owned investment and development
bank) eligibility criteria for green financing. The investment
is consistent with the Sustainable Development Goals of
the United Nations – it contributes to the sustainability
targets #7 – Affordable and Clean Energy and #13 –
Climate Action.
• Our new facility in Waltham, Massachusetts, in the US,
will support CSL’s growing R&D portfolio, including the
self-amplifying mRNA technology platform, the next
generation of mRNA vaccine technology, for seasonal
and pandemic influenza vaccines. The custom-built facility
consists of approximately 13,000 m2 overall including
5,000 m2 of laboratory space and the ability to house
about 300 full-time employees. All ongoing R&D programs
currently taking place in Cambridge, Massachusetts will
transition to the Waltham facility in the coming months
and it will act as a future North American campus for global
research collaborations. The new site is expected to be fully
operational later in 2022.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 6 Powered by Innovation
CSL’s therapeutic areas
Therapeutic
Areas
Immunology
Haematology
Respiratory
Cardiovascular
and Metabolic
Transplant
Influenza Vaccines
(Seasonal, Pandemic)
Platform
Plasma
Fractionation
Recombinant
Technology
Cell and
Gene Therapy
Adjuvanted
Cell-based
Egg-based
Immunology
Respiratory
In addition to our existing product ZEMAIRA®/RESPREEZA®
for patients with alpha 1 antitrypsin deficiency, CSL is
investigating new clinical treatments for respiratory diseases
using novel recombinant monoclonal antibodies and
plasma-derived therapies to address this need. Trabikibart
CSL311, our anti-beta common monoclonal antibody, is being
investigated for the treatment of severe uncontrolled asthma
and severe chronic obstructive pulmonary disease (COPD).
In idiopathic pulmonary fibrosis (IPF), a severe debilitating
disease, we have started a clinical development program
with garadacimab, the first of our compounds being
explored in this disease area. CSL787, our plasma-derived,
inhaled immunoglobulin is being investigated for patients
with bronchiectasis and severe COPD patients.
Transplant
In kidney transplant recipients, antibody-mediated
rejection (AMR) is a leading cause of allograft loss, and
there is significant unmet need for effective treatments.
Clazakizumab, our anti-interleukin-6 (IL-6) monoclonal
antibody, is currently being investigated in a Phase III clinical
trial (IMAGINE) for the potential treatment of chronic active
antibody-mediated rejection. In haematopoietic stem cell
transplantation, acute graft-versus-host disease (GvHD)
is a life-threatening type of rejection where the donor cells
attack the recipient; it is a leading cause of mortality and
morbidity following transplant. There is a significant unmet
need for more effective, less toxic therapies for GvHD.
We are investigating alpha 1 antitrypsin (AAT, ZEMAIRA®)
for the prevention and treatment of acute GvHD in two
Phase III studies.
Influenza Vaccines
With a focus on influenza, developing new and better
vaccines across all age groups in expanded markets
is a strategic priority for CSL Seqirus, including further
advancing our cell-based manufacturing technology and
our MF59® adjuvant and developing our self-amplifying
messenger RNA (sa-mRNA) technology, to enhance the
immune response of those particularly vulnerable to
influenza such as children and older adults. We are also
investigating a quadrivalent adjuvanted cell culture
influenza vaccine (aQIVc) which combines FLUCELVAX®
antigen with MF59® adjuvant, an additive that acts
to strengthen the immune response to vaccination.
Our efforts in this area focus on providing trusted products
and technologies to serve patients with a range of serious
immunologic and neurologic diseases, including primary
and secondary immunodeficiencies (PID and SID) and
chronic inflammatory demyelinating polyneuropathy (CIDP).
We are optimising patient experience and convenience
through more flexible ways to dose and administer our
existing immunoglobulin products. We are also progressing
key recombinant assets in early development such as our
anti-G-CSFR monoclonal antibody, CSL324, in certain
neutrophilic dermatoses. We continue to build on our strong
40-year legacy in hereditary angioedema (HAE) as we look
to expand on our current medicines to provide optimal
treatments for the full range of HAE patients, including
our recombinant monoclonal antibody garadacimab,
which is currently in Phase III development.
Haematology
CSL remains focused on easing the burden of disease and
improving the lives of patients with rare bleeding disorders.
We have made major advances in haemophilia A and B
in recent years with the launch of our novel recombinant
coagulation factor medicines and through the acquisition
of exclusive global licence rights to commercialise
etranacogene dezaparvovec, an AAV5 (adeno-associated
virus) gene therapy for the treatment of haemophilia B,
which is currently under regulatory review. Additionally, we
are undertaking exciting research and development efforts
to explore new indications in haematology as well as novel
therapeutics in haemostasis and thrombosis. This includes
planning for an important global Phase III study to evaluate
the early administration of KCENTRA® (4-factor prothrombin
complex concentrate) on survival in trauma patients
suffering life-threatening bleeding.
Cardiovascular and Metabolic
The cardiovascular and metabolic therapeutic area is
focused on improving and extending the lives of patients
with cardiovascular disease (CVD) and diabetes. CSL112,
apolipoprotein A-I (human), is being developed to reduce
the risk of recurrent cardiovascular events during the 90-day
high-risk period following a heart attack, the period when
the majority of first-year recurrent cardiovascular events
occur. If successful, CSL112 will be the first therapy to
demonstrate cardiovascular risk reduction through the novel
apoA-I mechanism and will transform how acute myocardial
infarction patients at high-risk of recurrent cardiovascular
events are treated. Beyond CVD, type 2 diabetes is one of
the fastest growing chronic diseases. CSL346, our innovative
anti-VEGF-B monoclonal antibody therapy is being studied
to augment the current standard of care to decrease the
progression of diabetic kidney disease, a frequent and
serious long-term diabetic complication.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Why We Need to ‘Disrupt’ Ourselves
Patients, Public Health, Our Employees
and the CSL business are counting on it
To be an innovator means that, at times, you will disrupt the
status quo and challenge orthodoxies to achieve better
outcomes. At CSL, we have a history of disrupting ‘the way
things are’. Equally, we are not afraid to also disrupt ourselves
if it means an even better experience or outcome for patients
and public health.
‘ As a key driver of CSL’s future growth, R&D’s job is to
create the pipeline and capabilities necessary to help
the CSL Behring and CSL Seqirus businesses grow in the
decades ahead. We need to provide our businesses with
the scientific platforms, products, skills, and expertise
that will meet the future health needs of patients and the
general public. This means that sometimes, our innovation
will disrupt our own offerings or ways of working in order
to better address the needs of those we serve.’
Dr William Mezzanotte, Executive Vice President, Head
of Research & Development and Chief Medical Officer
We need to look no further than CSL’s advancements in
haemophilia B, a rare disorder where blood doesn’t clot
normally due to not having sufficient factor IX.
Decades ago, CSL stepped up and introduced plasma-
derived factor replacement therapies – which, at the time,
significantly transformed the lives of people living with this
rare bleeding disorder. Despite having to be routinely
intravenously infused, and having to monitor their activities,
haemophilia B patients found this medicine provided a
benefit by helping them to lead fuller, more active lives.
Nevertheless, we knew we could do better. In 2016 we
received our first approval for IDELVION®, our long-acting
recombinant factor IX albumin fusion protein for the
treatment of haemophilia B. IDELVION® is also infused
intravenously, but patients who are well-controlled on this
regimen may potentially switch to a 14-day dosing interval
allowing them to better fit dosing into their schedules.
Moreover, this treatment reduces breakthrough bleeds and
gives patients the ability to lead a more active life. IDELVION®
is the standard of care in several countries around the world,
however, there is still an unmet need for many patients.
Which brings us to today, and our quest to bring the
promising etranacogene dezaparvovec, also known as
CSL222, to the market. Etranacogene dezaparvovec is an
adeno-associated virus vector serotype 5-based (AAV5) gene
therapy that is specifically designed to enable near-normal
blood-clotting ability by addressing the underlying cause
of haemophilia B – a faulty gene that causes a deficiency
in clotting factor IX. In clinical studies, etranacogene
dezaparvovec, after a single, one-time infusion, has been
shown to significantly reduce the rate of annual bleeds
in patients with haemophilia B, compared to when these
patients were receiving recombinant factor IX therapy alone.
If approved, etranacogene dezaparvovec would be the first
ever gene therapy treatment option for the haemophilia B
community and enable a major change to the lives of those
patients who are appropriate for the therapy.
‘ Etranacogene dezaparvovec, potentially the first gene
therapy approved for haemophilia B, further demonstrates
CSL’s mission to relentlessly pursue innovative and
disruptive technologies when it benefits patients with rare
and serious disease. This is what it means to truly Deliver
on Our Promise.’
Dr William Mezzanotte, Executive Vice President, Head
of Research & Development and Chief Medical Officer
Patients with hereditary angioedema (HAE) can expect the
same type of dedication from us. From the ground-breaking
BERINERT®, designed to halt HAE attacks, to the disruptive
HAEGARDA® which results in near-elimination of HAE
attacks, CSL is moving one step further as we study
garadacimab, an anti-factor XIIa monoclonal antibody. In
Phase II studies, this home-grown therapy produced similar
efficacy for HAE patients as does HAEGARDA® but with a less
frequent, once-monthly administration schedule and with
the additional patient-friendly benefit of an autoinjector for
easier administration.
CSL also disrupts in other areas where we already have
a lot of experience and world-class capabilities. Egg-based
vaccine manufacturing is the most common way that
influenza vaccines are made, with CSL producing them since
the 1940’s. However, newer technologies such as cell-based
vaccines, offer a modern, efficient and scalable alternative to
traditional egg-based manufacturing for seasonal influenza
vaccine production and rapid pandemic response. As the
largest cell-based influenza vaccine producer in the world,
CSL has been able to accelerate production from pilot scale
to industrial scale. Adding an adjuvant to both egg-based
and cell-based vaccines is intended to make these vaccines
more effective.
While we have world-class capabilities in cell-based and
adjuvanted vaccines, CSL continues to innovate with a
self-amplifying messenger RNA (sa-mRNA) technology
platform – the next generation of mRNA technology. During
the COVID-19 outbreak, mRNA technology was thrust into
the spotlight for its role in fighting the pandemic; sa-mRNA
takes the technology one step further. It could be beneficial
in both pandemic response and to help prevent seasonal
influenza more effectively and consistently, a major
advantage for public health.
In fact, to help expedite our work in this exciting area,
CSL is advancing a new R&D campus for sa-mRNA in
Waltham, Massachusetts, in the US, that will serve as the
company’s central R&D site for current and future vaccine
design, and collaborations with stakeholders from across
the industry and academia.
CSL will continue to explore ways to innovate and improve
medicines for patients and public health, even when we
are successful. That is what we have done for patients with
haemophilia B and hereditary angioedema, and with our
influenza vaccines and what we plan to do for others. It’s an
exciting time to be in the business of disruptive innovation
for patients, public health, our employees and the CSL
business as CSL R&D drives forward with this approach.
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Our strategic scientific platforms
To ensure a robust and diverse innovation pipeline based on a foundation of scientific excellence, CSL continues to strengthen
its therapeutic area focus. We use our strategic scientific platforms of plasma fractionation, recombinant protein technology,
cell and gene therapy, and vaccines technology to support continued innovation and continually refine ways in which products
can address unmet medical needs, help prevent infectious disease and protect public health, and help patients lead full lives.
Plasma Fractionation
Recombinant Protein
Technology
Cell and Gene Therapy
Vaccines Technology
Plasma is a valuable resource for many current and potentially new biological therapies.
We rely upon our donors to provide this lifesaving resource and as such, CSL Behring has
an obligation to maximise the development and delivery of important products from this
vital resource for the benefit of patients. Maximising patient benefit through our yield
and reliability programs for donated plasma continues to be an important, strategic area
of focus for CSL as we strive to be the industry pacesetter.
The capability to develop and manufacture recombinant proteins facilitates the ability to
manipulate the sequence of naturally occurring proteins to achieve desired therapeutic
goals, such as the ability to replace a patient’s own deficient or inactive protein, selectively
target specific biological mechanisms, enhance potency and improve pharmacokinetics,
resulting in more effective, highly differentiated medicines with the potential to optimise the
route and frequency of delivery. Monoclonal antibodies are a specific subset of recombinant
proteins that are developed to have a highly specific targeting to block or enhance certain
biologic or immune processes which lead to disease states – the specificity of the targeting
of monoclonal antibodies ensures very high efficacy with minimal side-effects.
Cell and gene therapies are highly innovative, next-generation products that, after decades
of research and development, are now starting to improve the lives of patients with serious
diseases. For diseases with few effective therapeutic options, such as certain blood cell
cancers, or where successful therapy has required a lifetime of regular symptomatic
treatment, such as rare inherited genetic deficiencies, they offer the promise of a long-term
cure. The fundamental differentiating characteristic of cell and gene therapies is that the
patient’s own cells are manipulated to produce the disease-correcting protein, rather than
the traditional approach of manufacturing the protein and then periodically administering
it to the patient.
CSL’s Seqirus business is a global leader in seasonal influenza prevention and control and a
transcontinental partner in pandemic preparedness. Our broad range of influenza vaccines
– egg-based and cell-based products, seasonal, pre-pandemic and pandemic influenza
vaccines – meets the needs of different populations around the world. CSL’s commitment
to population protection is evidenced through our innovative vaccines pipeline, which
includes next generation technologies such as aQIVc and self-amplifying mRNA.
Located over two floors of CSL’s new corporate headquarters
being built in the Melbourne Biomedical Precinct, the
incubator will have one floor of purpose-built wet laboratory
space and another for meetings and office space. There,
the incubator will be embedded alongside seven floors
of leading-edge laboratory and clinical manufacturing space
supporting CSL’s own R&D programs.
‘ CSL is driven by our promise as a patient-focused
organisation, so this incubator model clearly aligns with
our Values and Purpose. We are well positioned to support
incubator residents, whose experience often lies purely
within the lab, better understand clinical and commercial
aspects of medicines development that may be foreign
or new to them.’
Paul Perreault, Chief Executive Office
Global collaborations for innovation
Our R&D portfolio focuses on innovation in new products,
improved products and manufacturing expertise, ensuring
our continued growth. In pursuit of these goals, we recognise
and embrace that we cannot, and should not, do it ourselves.
Thus, CSL continues to identify and build strategic
collaborations that align with our therapeutic areas of focus
and enhance our chances of bringing forward beneficial
disruptive innovation.
An incubator, to be located at CSL’s new global corporate
headquarters under construction in the world-leading
Melbourne Biomedical Precinct, will support start-up
companies to translate promising medical research into
commercial outcomes. The incubator will be the first
and only incubator in Australia co-located with a leading
biotechnology company. This has been made possible
with financial and in-kind support from CSL, University of
Melbourne and the WEHI, who have formed an incorporated
joint venture to establish and operate the incubator, plus
a contribution from Breakthrough Victoria, an independent
Victorian Government owned company administering the
Victorian Government’s landmark A$2 billion Breakthrough
Victoria Fund. The incubator is scheduled to open to start-
ups in 2023 with cutting edge facilities for up to 40 early
stage companies from around Australia.
3232
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 ‘ Formalising a place to nurture promising start-ups is
a natural extension of our long-term support of, and
collaboration with many like-minded partners. We hope
to see significant long-term health, social and R&D
benefits from this initiative, including greater retention
and upskilling of domestic research and development
capabilities and an increase in commercial acumen
of [Melbourne Biomedical] Precinct researchers.’
Dr Andrew Nash, Chief Scientific Officer and Senior
Vice President, Research
Each year, CSL works to identify promising research
programs across the globe which will benefit most from
industry collaboration and support.
In October 2021, WEHI and CSL, announced a collaboration
to create a Centre for Biologic Therapies (Centre) which will
combine WEHI’s expertise in immunology, cancer,
inflammatory disorders and infectious diseases with CSL’s
world-class human antibody library and experience in
biologic drug discovery and development.
Based at WEHI, the Centre will provide access to expert
biologic discovery and optimisation capabilities accelerating
drug development into the clinic, ultimately addressing
a current gap in Australian medical research. The Centre
aims to generate high-quality and clinic-ready therapeutic
antibodies against novel targets in human disease. The
partners will contribute equal funding to the Centre, with a
combined investment of A$10 million for the next five years.
In November 2021, CSL announced a collaboration with
StartX, the industry and stage-agnostic community of
founders based in Silicon Valley, as an Innovation Partner
over a two-year program. Through this partnership, CSL will
support entrepreneurs in the StartX community as they
commercialise innovative technologies and develop novel
therapeutics. By providing access to commercial, R&D,
clinical, intellectual property, marketing and manufacturing
expertise, CSL will work with the StartX community to
accelerate the start-up trajectory and deliver outcomes
to patients faster.
Similarly, the partnership will further one of CSL’s innovation
goals of broadening and diversifying its R&D portfolio
through strategic partnering with biotech incubators,
accelerators and entrepreneurial ecosystems.
‘ The Centre for Biologic Therapies is an interface of
innovation between research and industry and sets
the foundations for significant growth in the Australian
biologics discovery and development space that has the
potential to create opportunities for researchers locally
and innovative medicines for patients globally.’
Dr William Mezzanotte, Executive Vice President, Head
of Research and Development and Chief Medical Officer
In support of the yearly seasonal influenza vaccine epidemic,
CSL Seqirus collaborates with the WHO Collaborating
Centre in Melbourne, Australia to prepare vaccine seeds
and potency reagents that are made widely available.
This is an important contribution to assist with the global
effort to prepare for the forthcoming vaccination season.
Influenza remains one of our greatest global health threats.
CSL is committed to collaborating with like-minded partners
to advance understanding of the human response to
influenza and to discover new and innovative vaccine
solutions. CSL’s research development program will benefit
from the recent multi-year contract with the US Department
of Health & Human Services (HHS) to investigate influenza
vaccine technologies and develop cell-based and sa-mRNA
influenza A (H2Nx) vaccine candidates for assessment in a
Phase I clinical study with the goal of helping to safeguard
communities in the event of an influenza pandemic.
This builds on our longstanding public-private partnership
to provide a rapid response in the event of an influenza
pandemic. The company will continue to consider options
for an industrial-scale mRNA vaccine manufacturing facility
and determine where it is most compatible within our global
network. As announced in November 2020, a new facility for
the manufacture of cell-based influenza vaccines is currently
under construction in Melbourne and is on track to open
in 2026.
Strategic support for innovative medical research
One of our core values at CSL is innovation and over the
past year we have continued to support collaborative
innovation through the endowment of the following
awards to researchers around the world.
• The Heimburger award is a global award available to
researchers across the world. Professor Dr Norbert
Heimburger, a CSL Behring employee for over three
decades, was a pioneer of modern coagulation therapy.
Among his many achievements, Prof Dr Heimburger
developed virus-safe plasma products based on
pasteurisation, including launching the first effectively
virus-inactivated FVIII concentrate in 1981. In his honour,
CSL Behring created the Heimburger Award, recognising
clinical and/or preclinical research of emerging coagulation
specialists who are driven to improve the care of patients
with bleeding disorders. In July 2021, five recipients from
Australia, Belgium, Italy, Ireland and the Netherlands
received this award.
• In October 2021, two Australian scientists were each
awarded a CSL Centenary Fellowship, valued at
A$1.25 million over five years, to investigate two novel
technologies to enable the rapid development of antiviral
drugs and to unravel the processes that enable production
of proteins from genes, both of which will generate
fundamental knowledge that could transform how
we fight disease.
3333
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 58
3
clinical trials in
operation across
all therapeutic
areas
regulatory
authority inspections
with no impact to
clinical trial conduct
The CSL Clinical Quality Management System allows us
to monitor and effectively oversee the quality of our clinical
trials and includes both regulatory authority inspections
and internal audits for good clinical practice (GCP), good
pharmacovigilance practice (GVP), good manufacturing
practice (GMP), good laboratory practice (GLP) and good
research laboratory practice (GRLP).
Over the reporting period, three clinical trials were added,
and 15 clinical trial results were posted, on an International
Committee of Medical Journal Editors (ICMJE)-recognised
public clinical trial registry. These were all disclosed in a
timely manner and in compliance with our transparency
policy. Our policy reflects international requirements and
standards including requirements from ICMJE, WHO
guidance and legislative requirements.
In addition, three inspections were undertaken by regulatory
agencies including the Japanese Pharmaceuticals and
Medical Devices Agency (PMDA) and regional health
authorities in Germany. All inspections confirmed adherence
with GCP requirements, validated the data integrity of our
clinical trials and had no impact on clinical trial operations.
6 Powered by Innovation
Listening to our patients’ needs
One of CSL’s most valuable assets is our ability to engage
in meaningful dialogue with patients and their support
networks. Understanding patient needs has contributed
significantly to the success of CSL’s R&D operations. During
2021/22, more than 40 advisory boards were conducted
with patients and members of their support community.
Building on this experience, we are creating events and
forums where patients sit alongside senior CSL executives
to guide and shape our corporate patient focus mindset
and strategies. Through our close working relationship with
patients, CSL is better able to keep our promise to patients
and the public’s health and enhance our overall reputation.
‘ We embed patient focus into our ways of working –
learning the needs of patients and amplifying their
voices in the development of therapies – helping
us to Deliver on Our Promise.’
Deirdre BeVard, Senior Vice President,
R&D Strategic Operations
Clinical trials in progress and new
In 2021/22, CSL had 58 clinical trials in operation across all
therapeutic areas. Of those, 5 had a first patient enrolled
in the trial during the year.
CSL conducts ethical clinical trials and adheres to exemplary
standards of integrity in the formulation, conduct and
reporting of scientific research. This is based upon three
primary elements: scientific integrity; patient safety; and
investigator objectivity.
When Patients Speak – CSL Listens
When CSL needed to assess how best to implement
a series of upcoming studies, we didn’t make
assumptions – we asked patients.
By listening to patients from several countries around
the world, we were able to gain valuable insights
regarding the diagnosis journey, treatment paradigms,
potential barriers to study participation, attitudes
around clinical research within the patient population
and other key factors crucial to study protocol design
and clinical trial planning. Our Clinical Operations
group has also pioneered embedding patients into
our study teams to better ensure patient focus
in our clinical trials.
3434
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 For our CSL Seqirus business, 2021/22 brought progress
in the expansion of our influenza vaccine portfolio through
new licences and extension of indications.
In 2022, FLUAD® QUAD, our four-strain adjuvanted
influenza vaccine, was authorised for persons 65 years
and older in Argentina.
Launch of FLUCELVAX® QUAD, for six months and above,
was first achieved in Argentina in the Southern Hemisphere
2022 influenza season.
FLUCELVAX® QUADRIVALENT was also approved for
expanded age indications down to six months of age in the
US. FLUCELVAX® QUAD was also approved for expanded age
indications down to six months of age in Canada, down to
two years of age in Australia and nine years in New Zealand.
In Australia and New Zealand, CSL Seqirus’ in-licensing
business continues to provide greater access to a broad
portfolio of vaccines and medicines. The RYALTRIS®
(olopatadine hydrochloride and mometasone furoate
monohydrate) licence was extended in Australia to include
the treatment of symptoms associated with allergic rhinitis
and rhinoconjunctivitis in patients six years of age and older.
New products to market
CSL Behring continues to broaden the geography and use
of our medicines for rare and specialty diseases across the
globe within our immunology, haematology and vaccine
therapeutic areas.
Within the immunology portfolio, regulatory indication
expansion and new registrations are primarily focused on our
subcutaneous immunoglobulin HIZENTRA®, our intravenous
immunoglobulin PRIVIGEN® and our human C1-esterase
inhibitor BERINERT®. In 2021/22, indication expansion
was sought for HIZENTRA® and PRIVIGEN® for chronic
inflammatory demyelinating polyneuropathy (CIDP) and
secondary immunodeficiency (SID). Additionally, further
indication expansion for PRIVIGEN® was sought in select
markets. CIDP is a chronically progressive, rare autoimmune
disorder that affects the peripheral nerves and may cause
permanent nerve damage. The myelin sheath, or the
protective covering of the nerves, is damaged, which may
result in numbness or tingling, muscle weakness, fatigue
and other symptoms, which worsen over time. SID is similar
to primary immunodeficiency (PID) however SID occurs when
the immune system is compromised as a result of disease or
due to an environmental factor (e.g., chemotherapy, disease
complication). Additionally, four new product registrations
were achieved for RHOPHYLAC® 300 and two for TETAGAM®.
In our haematology therapeutic area, the focus in 2021/22
was continuing the expansion of the current portfolio. Five
new product registrations were achieved for our human
coagulation factor VIII/vWF HAEMATE® and four for human
albumin. Three new product registrations were achieved for
each of BERIATE®, our human coagulation factor VIII product
and AFSTYLA®, our recombinant factor VIII product, both of
which are used to control and prevent bleeding episodes in
people with haemophilia A, and three for BERIPLAST ® P, our
combined human fibrinogen, factor XIII and bovine aprotinin
product. Two new product registrations were achieved for
HAEMOCOMPLETTAN® P, our human fibrinogen concentrate.
Additionally, new product registrations were achieved for
IDELVION®, our recombinant factor IX product, and
BERIPLEX®, our human prothrombin complex concentrate.
3535
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 6 Powered by Innovation
Product Registrations and Indications 2021/22*
Immunology Products
Focus on improved patient convenience, plasma yield improvements, expanded labels, new formulation
science and recombinant technology.
Product
Type
Country/Region
BERINERT® C1-Esterase Inhibitor (Human) Intravenous or Subcutaneous1
NR
India, Taiwan, Netherlands, Ireland, Hong Kong,
Lithuania, Estonia (500 IU); Netherlands, Ireland,
Lithuania, Estonia (1500 IU); Russia, Netherlands,
Ireland, Chile, Lithuania, Estonia (2000 IU & 3000 IU)
PRIVIGEN® Immune Globulin Intravenous (Human) 10% Liquid
NR Qatar, Brunei
RHOPHYLAC® 300 Human anti-D (Rh0) immunoglobulin
NR Hong Kong, Peru, Ecuador, Paraguay
TETAGAM® Human Tetanus Immunoglobulin
NR Netherlands, Belgium
HIZENTRA® Immune Globulin Subcutaneous (Human) 20% Liquid
PRIVIGEN® Immune Globulin Intravenous (Human) 10% Liquid
NI
NI
European Union, Great Britain, Hong Kong,
Macedonia (SID); Philippines, Hong Kong,
Jordan (CIDP)
Taiwan (MMN, MG, LEMS, SPS); Hong Kong
(CIDP, SID)
Haematology Products
Maximise the value and performance of our existing coagulation therapies and develop new protein
and gene-based therapies.
AFSTYLA® Coagulation Factor VIII (Recombinant)
Albumin (human) 20% Behring, low salt
ALBURX® Human Albumin
BERIATE® Coagulation Factor VIII (Human)
BERIPLAST® P Combi-Set
BERIPLEX® Prothrombin complex (Human)
HAEMATE® Coagulation Factor VIII/vWF (Human)
NR
NR
Saudi Arabia, United Arab Emirates, Qatar
Algeria
NR Ukraine, Peru, Jamaica
NR Malaysia, Ecuador, Jamaica
NR
NR
NR
India, Paraguay, Indonesia (3 mL)
Paraguay
Chile, Lithuania, Latvia, Estonia;
Malaysia (1000 IU)
HAEMOCOMPLETTAN® P Fibrinogen Concentrate (Human)
NR
India, Hong Kong
IDELVION® Coagulation Factor IX (Recombinant) Albumin Fusion Protein
NR Russia
ALEVIATE® Coagulation Factor VIII/vWF (Human)
NI
Hong Kong (vWD prophylaxis)
Vaccines
Develop products for the prevention of infectious diseases.
Adjuvanted Quadrivalent Influenza Vaccine (Surface Antigen, Inactivated)
Seqirus suspension for injection PFS (unbranded duplicate of FLUAD® TETRA)
Cell-based Quadrivalent Influenza Vaccine (surface antigen, inactivated)
Seqirus suspension for injection in PFS (unbranded duplicate of
FLUCELVAX® TETRA)
NR Great Britain
NR Great Britain
FLUAD® QUAD Influenza Vaccine, Adjuvanted (surface antigen, inactivated)
NR
FLUCELVAX® QUADRIVALENT Influenza Vaccine (cell culture)
FLUCELVAX® QUAD Influenza Vaccine (surface antigen, inactivated,
cell culture)
FLUCELVAX® QUAD Influenza Vaccine (surface antigen, inactivated,
cell culture)
FLUCELVAX® QUAD Influenza Vaccine (surface antigen, inactivated,
cell culture)
NI
NI
NI
NI
Argentina (for the prevention of influenza
in persons 65 yrs of age and older)
United States (for the prevention of influenza
in persons six months of age and older)
Canada, Argentina (for the prevention of influenza
in persons six months of age and older)
Australia (for the prevention of influenza
in persons two yrs of age and older)
New Zealand (for the prevention of influenza
in persons nine yrs of age and older)
In-Licensed Products 2
RYALTRIS® (olopatadine hydrochloride & mometasone furoate monohydrate)
NI
Australia (for the treatment of symptoms associated
with allergic rhinitis and rhinoconjunctivitis in
persons six yrs of age and older)
* First-time registrations or indications for CSL products in the listed countries/regions over the reporting period.
1 In some markets, subcutaneous version of C1-esterase inhibitor can be marketed as HAEGARDA®.
2 RYALTRIS® is a registered trademark of Glenmark Pharmaceuticals Ltd.
CIDP = Chronic Inflammatory Demyelinating Polyneuropathy, LEMS = Lambert-Eaton Myasthenic Syndrome, MG = Myasthenia Gravis,
MMN = Multifocal Motor Neuropathy, NI = New Indication, NR = New Registration, PFS = Pre-Filled Syringe, SID = Secondary
Immunodeficiency, SPS = Stiff Person Syndrome.
3636
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 7 Our People
At CSL, we are driven by our promise to save and improve lives. Our highest priority is the
safety and wellbeing of our people, donors and patients.
Throughout this year, our employees, guided by our CSL
Values, navigated ongoing challenges while they
demonstrated remarkable agility and resiliency. The majority
of our more than 30,000 global employees worked onsite
in our manufacturing facilities and plasma donation centres
to ensure our lifesaving medicines and vaccines were
available to the patients and communities we have the
privilege to serve.
Board*
Target 30% representation
by either gender
Senior Executive*
Target 40% by FY30
People Manager*
Target 50% by FY25
All Employees*
CSL’s success starts with a culture and workplace where
people can do their best work and have promising futures,
and we continue to invest in our people.
9
Total
Promoting diversity, equity and inclusion
576
Total
3,741
Total
30,398
Total
We strive to embed diversity, equity and inclusion (DE&I) in
everything we do – from how we attract talent and support
our employees to how we engage with the communities
in which we live and work. People represent a variety of
dimensions of diversity, including but not limited to: gender,
nationality, ethnicity, disability, sexual orientation, gender
Board*
identity, generation/age, socioeconomic status, marital/
Target 30% representation
family status, religious beliefs, language, professional and
by either gender
educational background, and cultural experiences. Focusing
on diversity alone is not enough. We also need our people to
feel like they belong (inclusion) and experience fair treatment
and access to opportunities (equity). CSL’s global diversity
and inclusion policy can be found on CSL.com (Our Company
> Corporate Governance).
Senior Executive*
Target 40% by FY30
9
Total
576
Total
We set annual DE&I objectives, with multiyear goals, aligned
with the following pillars:
• Diverse Workforce: build a more diverse workforce to bring
a wide variety of viewpoints and ideas to the work that
Female 44%
we do every day, including achieving positive progress
Male 56%
toward gender diversity within management and senior
executive levels, while reflecting ethnic, cultural and
disability diversity;
Female 31%
Male 69%
Female 44%
Male 56%
Female 31%
Male 69%
Female 46%
Male 54%
Female 61%
Male 39%
People Manager*
Target 50% by FY25
All Employees*
3,741
Total
30,398
Total
Female 46%
Male 54%
Female 61%
Male 39%
• Inclusion: foster an inclusive culture in which all employees
are respected, valued and inspired to do their best work,
including implementing an internal global DE&I series
to develop employees on inclusive behaviours and other
DE&I topics; and
• Marketplace Reputation: enhance our external reputation
by partnering with organisations and suppliers who share
our passion for DE&I.
We continue to make positive strides in our diversity makeup
and aim to achieve greater diversity in the composition of our
senior executive and management populations. Looking
at our year-end gender composition as of 30 June 2022,
the following graphs highlight the proportion of women
and men on the CSL Board of Directors, in senior executive
positions (senior director and above), people managers with
three or more direct reports as well as all employees across
the entire organisation.
* Limited assurance by Ernst & Young. Percentage data for
Senior Executive, People Manager and All Employees excludes
100 employees with unspecified gender.
Our long-term gender targets
We have set a People Manager target of 50% female
representation and will continue to pursue this target
and look to achieve it by 2025. For Senior Executives, we
have set a target of 40% female representation by 2030.
In accordance with the requirements of Australia’s
Workplace Gender Equality Act 2012 (Act), CSL lodged its
annual public report with the Workplace Gender Equality
Agency (WGEA). A copy of this report is available at CSL.com
(Our Company > Corporate Responsibility > Workplace).
3737
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 7 Our People
Our multigenerational workforce includes employees
ranging in ages from baby boomer to generation Z.
All Employees*
Senior Executives
Providing promising futures for employees
People Managers
At CSL, we want all employees to pursue their career
aspirations and reach their potential. We launched our
Promising FUTURES channel to reflect our commitment
to helping employees develop and thrive. From stories
about colleagues’ career journeys to career development
tips to guidance on how to use our HR programs and
benefits, colleagues around the world are encouraged
to learn, grow and be inspired.
Gen X (1962-1979) 51%
We believe in the power of education to create opportunities
and change peoples’ lives. CSL launched its Promising
Futures Scholarship program in the US two years ago
to provide financial assistance to employees and their
dependents for technical school, vocational school, two- and
four-year colleges or advanced education. The program was
specifically designed to support individuals from traditionally
underprivileged, under-represented communities – those
who have had to overcome substantial obstacles to pursue
their studies or first-generation college students. Thanks to
the overwhelmingly positive response to the U.S. program,
we expanded and introduced the program to include
Australia this year.
Baby Boomers (1946-1961) 6%
Gen Y (1980-2000) 43%
‘ I just wanted to sincerely thank you for all the help and
guidance you provided to Christian and I in submitting
his application for the ‘Promising Future’ scholarship.
We are both elated by this opportunity CSL has
provided to us and feel really fortunate to have been
given this support. I can’t thank you enough…’
Robert LaFerla, Manufacturing Sciences and
Technology Principal, Australia
‘ I am elated by this scholarship being awarded to
me and feel really fortunate to have been given this
support in the pursuit of my studies. I am incredibly
grateful for receiving this award as it guides me
towards completing my tertiary education in
biological sciences. This means far more to me than
I can explain as my future goal is to work and be
a part of CSL Behring. I can’t thank you enough
for all the support you have provided me.’
Christian LaFerla, Scholarship Recipient
Gen Y (1980-2000) 56%
Gen X (1962-1979) 33%
Gen X (1962-1979) 78%
Gen Y (1980-2000) 10%
Baby Boomers (1946-1961) 6%
Baby Boomers (1946-1961) 12%
Gen Z (2001+) 5%
Data includes all employees globally where birthday is recorded (99.8% of population).
All Employees*
Senior Executives
People Managers
Gen Y (1980-2000) 56%
Gen X (1962-1979) 33%
Gen X (1962-1979) 78%
Gen Y (1980-2000) 10%
Gen X (1962-1979) 51%
Gen Y (1980-2000) 43%
Baby Boomers (1946-1961) 6%
Baby Boomers (1946-1961) 12%
Baby Boomers (1946-1961) 6%
Gen Z (2001+) 5%
Data includes all employees globally where birthday is recorded (99.8% of population).
Data includes all employees globally where birthday is recorded
(99.8% of population).
* Limited assurance by Ernst & Young.
CSL is assessing the global legal landscape to be able
to capture demographic information related to multiple
diversity classifications. This information will be used to
measure and further focus our efforts as we strive to ensure
we have the broadest array of diversity within our employee
population. Currently, our ethnically diverse talent represents
CSL’s Disability Profile (Germany and US)
53% of our workforce in the US.
[■ Insert introductory paragraph, consistent
Ethnicity of our US employee population follows.
with the sections above.]
White 45%
African American/Black 30%
Hispanic 16%
Asian 4%
Two or More Races 4%
Other 1%
3838
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 People and culture
39
CSL Limited Annual Report 2021/22 7 Our People
CSL has also established early career programs for STEM
talent around the globe to build our future talent pipeline.
Our Australian Graduate Program focuses on attracting,
developing and retaining top graduates who are highly
driven, innovative and tech-savvy. The two-year program
provides undergraduates career opportunities within our
global businesses through cross-functional rotations and
specialised development. Since the program’s inception,
we have recruited 64 graduates with 96% conversion into
roles post-program and a 92% retention rate.
The EMEA Trainee Program offers candidates, who recently
graduated with a bachelor, master and doctorate degree,
a two-year, cross-functional rotation program in the areas
of engineering, marketing, medical affairs, manufacturing,
quality and/or R&D. Candidates have an assigned mentor
and participate in a wide range of development and social
opportunities, including leadership assessments, innovation
sessions and project management. All trainees who have
completed the program have secured full-time employment
with CSL.
Our North America Internship & Co-op Program attracts
and retains students enrolled in a four-year college or
university. The 12- to 26-week program builds on classroom
theory by providing students with practical, hands-on
experience. Interns receive a wide range of development
opportunities, including an Insights Discovery Assessment,
skill-building workshops and business-specific training.
The roles span multiple CSL entities, business functions
and locations. This year, CSL hired 38 interns and co-op
students in the U.S.
Developing Our Future Leaders
We maintain a wide range of personal and professional
development programs to ensure we can meet the evolving
needs and expectations of our leaders. From developing
strategy and executing undertakings with excellence to
driving innovation and fostering an inclusive culture, the
role of a leader has never been more critical. That is why
we continue to support the ongoing development of CSL’s
current and future leaders. Following are descriptions
of some of our development offerings.
• Mentoring has been embedded into our learning and
development for people leaders across the globe. More
than 1,400 employees – 51% of whom are female and
41% ethnic (U.S. ethnicity only) – are currently participating
in our Global Mentoring Program.
• Leadership Excellence is a program for directors and
associate directors across all areas of our business.
The program features subject matter centred around
leadership agility and translating future trends into
enterprise strategy. It also includes business simulations
and reverse mentoring to broaden participant
perspectives. To date, nearly 400 CSL leaders – 52% female
and 48% male – across four cohorts have participated.
• Management Essentials is a program for senior managers
and managers across all areas of our business. This
program historically engages an even split of female and
male participants throughout the learning experience.
Core and elective modules help participants build
leadership capabilities related to a variety of topics. This
year, we added Unconscious Bias as a core module of the
program with a focus on the individual biases that affect
relationships, collaboration and performance. In 2022,
119 employees graduated from the program.
4040
• Our Discovery program focuses on enhancing the
knowledge and capabilities of our self-led, individual
contributors through the development of their own
personal effectiveness, expanded self-awareness and
collaboration capabilities, and improved change and
time management skills. There were 216 participants –
68% female and 32% male – in our 2022 cohort.
Celebrating employees’ contributions
CSL’s global recognition program, Celebrate the Promise,
is an online platform that allows employees and leaders
to easily send recognition to anyone at any time and for any
reason – from a simple thank you to acknowledgement of a
major accomplishment. Each recognition is tied to a specific
CSL Value. For more significant achievements, employees
may receive points to purchase merchandise from an online
catalogue. Since launching the program in September 2020,
participation has been impressive with over 212,000 global
recognition moments (as of 30 June 2022) being shared, and
Collaboration and Superior Performance being the top two
most-recognised CSL Values.
Listening to our people
As we emerge from the pandemic and experience a new
way of working, we continue listening to our employees’
views on critical aspects related to working at CSL.
Conducted in financial year 2021/22 in partnership with
external vendor Korn Ferry, our enterprise-wide Culture
& Learning Assessment indicated that the overwhelming
majority – 96% – have a clear understanding of CSL’s Values
(+ 11 to global benchmark), and 88% agree CSL is customer-
and patient-focused (+ 12 to global benchmark). 61% of all
people leaders participated in the assessment, which also
involved eight focus groups of individual contributors and
interviews with 14 executives.
Each year, we invite employees to provide feedback on
numerous important topics, such as our CSL Values and
culture, employee engagement and development,
collaboration across the enterprise, CSL’s Vision and decision-
making through our Employee Engagement Survey. In 2022,
we had the highest participation to date with more than
20,500 colleagues sharing their thoughts and opinions.
This year’s Engagement Index is 77.9*, up 4.2 points from last
year’s survey and on par with the global external benchmark
maintained by our survey administrator, Perceptyx, and
representing responses from over 11 million employees across
multiple industries and geographies. As in prior years, each
member of our Global Leadership Group analyses their
respective results to identify a few meaningful engagement
objectives and related action plans for the new financial year.
We also offer ‘Analytics to Action’ training to managers,
supporting them with interpreting their team feedback
and identifying strengths on which to build or opportunities
to improve.
*Limited assurance by Ernst & Young
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Caring for our people
Safety and wellbeing
The health and well-being of our employees is a top priority
at CSL, and we have implemented numerous programs
to enhance our support of employees’ physical, emotional
and financial health especially in light of the pandemic.
Enhancements have included:
• offering employees two wellness days in 2022 as we did
in 2021;
• expanding Employee Assistance Programs across all
locations and offering eight sessions to all employees
and their dependents at no cost;
• introducing Headspace, a mental health and well-being
app, to employees in nearly all locations;
• augmenting CSL’s existing leave offerings by providing
more options to assist global caregivers with paid time
off and accommodate those who need additional time
away from work;
• reviewing and adjusting health and risk coverage in all
major geographies to ensure employees have access to
care specifically needed in light of COVID-19, including
coverage for death and disability, inpatient and outpatient
services, COVID-19 testing, vaccination and telemedicine;
• introducing a charitable matching contribution program
for employees in the US and Australia;
• providing family forming benefits and gender affirmation
coverage to employees in US locations; and
• offering employees in U.S. locations additional support
to help them find and pay for back-up care for children,
elders and pets.
As our people balance a variety of professional and personal
demands, we continue to support workplace flexibility. We
established a hybrid work environment for those whose roles
permit remote work and embedded an ongoing emphasis
on safety and enhanced recognition for essential employees.
Building a sustainable workforce
At CSL, our people are our greatest asset, and ensuring
we have a sustainable workforce is critical to our business
growth and sustained success.
In 2022, we continued to execute on our sustainability
strategy with a focus on:
• Raising awareness, visibility and action, including the
promotion of sustainability across the end-to-end
working experience;
• Communicating to and involving employees in programs
that maximise diversity, equity and inclusion; and
• Ensuring all employees have access and opportunity
to engage with community-giving programs and
volunteering for local needs.
Employee response to the company’s sustainability efforts
has been positive. According to the 2022 Employee
Engagement Survey, 78.2%* said they feel good about the
ways CSL contributes to the community – up 2.5 points year
over year and on par with the global external benchmark
maintained by our survey administrator.
*Limited assurance by Ernst & Young
CSL is committed to providing safe, healthy and secure
workplaces for our employees, other persons present on
our premises and the communities in which we operate.
Our Environmental, Health and Safety (EHS) Management
System seeks to uphold our EHS principles that aim to
keep people safe, protect the environment and build trust
internally and externally. Each year, CSL establishes robust
key performance indicators to measure our adherence
to our values and drive improved results.
The EHS team works collaboratively with site operations
management and employees to proactively identify
and correct workplace hazards and risks, strengthen
communication, define roles and responsibilities and
promote a company-wide culture of safety at all of our
manufacturing, laboratory and office locations.
Over this reporting period we continued the implementation
of Enablon®, a cloud-based EHS software solution utilised
by all employees, contractors, and visitors for event reporting,
incident investigation, inspections, corrective measures and
metrics. Enablon® is utilised to standardise and modernise
safety reporting and processes across the organisation.
As part of our commitment to continuously improving
our EHS performance, a global review of our management
system against ISO 14001 & 45001 was conducted during
the year, and an update to the system and implementation
is planned for next financial year.
Our Health and Safety Performance*
Total Recordable Injury Frequency Rate (TRIFR)†
(per million hours worked)
Year
21-22
20-21
Non-CSL
Plasma sites
CSL Plasma
Fatalities (employees
and contractors)^
Non-CSL
Plasma sites
CSL Plasma
Fatalities (employees
and contractors)^
Targets‡
Results‡
≤3.5
1.39
≤10.8
0
≤3.5
≤10.8
0
10.67
0
1.88
11.20
0
* Limited assurance by Ernst & Young.
† Total Recordable Injury Frequency Rate (TRIFR) is the rate of injuries
resulting in a fatality, lost time from work ≥ one day/shift, and
medical treatment beyond first aid calculated as TRIFR = (# Injuries)
x(1,000,000)/(hours worked). Includes employees and workers
directly supervised by an employee.
‡ Data is calculated over a 36-month period of time. Targets are set
at 50% of the 36-month industry average for the period published.
Data is separated into CSL Plasma and non-CSL Plasma sites
to account for the difference in the inherent hazards in plasma
collection centres as compared to manufacturing facilities and the
resulting differences in how industry data is published.
^ Applies globally to all operations and employees, including part-
time employees, contracted employees, and temporary employees
(or other individuals) whose work is directly supervised by a CSL
employee. This includes contracted employees that perform work
that is directly related to the company’s core work and provide
work direction from the Company. Does not apply to independent
contractors: who perform non-core servicing, maintenance or
construction related work. Work performed by an independent
contractor is not controlled nor directed by CSL and its entities
but by the hired party.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 8 Environment
Our commitment to a healthier world means delivering for both people and our planet.
For a century we have strived to provide our life-saving medicines in an efficient, inclusive
and environmentally respectful way. We take this responsibility seriously, and our promise
is to continue to further build environmental considerations into our business so we can
deliver a sustainable world for the next century and beyond.
In addition to material topics featured, our strategic sustainability focus areas include the following:
• Integrate sustainability considerations into business decisions.
• Reduce carbon emissions.
• Minimise end to end production of waste through removal, reduction and recycling.
• Across our supply chain reduce waste and emissions.
Promoting environmental protection
At CSL, we recognise that responsible management and efficient use of natural resources is key to our sustainable growth
and our ability to enable efficient and reliable supply of our life-saving medicines.
CSL has an Environment, Health, Safety and Sustainability (EHS2) function, which ensures its facilities operate to industry and
regulatory standards. This strategy includes compliance with government regulations and commitments to minimise the
impact of operations on the environment. Our EHS2 Management System provides the platform for policies, procedures and
guidelines, which manage our business processes. We are committing resources and time into new technology to capture,
calculate and report global environmental data, a significant stepping stone to delivering on our roadmap for achieving our
emissions reduction targets.
In 2021/22, across our network of manufacturing facilities and CSL Plasma centres there were no breaches of environmental
laws that resulted in a financial penalty or public notice.
Protecting a natural reserve
CSL Behring’s manufacturing facility at
Broadmeadows, Australia, is located within close
vicinity to Jack Roper Reserve. The reserve, while
primarily serving as a flood mitigation retention
basin, is also a picturesque lake and popular park for
local families. With the significant expansion of our
facility at this site, works were undertaken to ensure
appropriate management of stormwater runoff.
In order to buffer stormwater from our site a wetlands
was installed on location, along with a series of weirs
and outfeed pipes that will bring the site within
specification for release, even during a one-in-100 year
rain event. The wetlands are also designed with an
automated valve that can be closed in case of the
unlikely event of chemical spill. The wetlands were
approved by the local water authority and passed
all reviews and inspections.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Environmental trends
Compared with the prior year, modest increases were experienced across energy consumption, greenhouse gas emissions
and water consumption. These increases are largely due to fluctuating manufacturing volumes and commissioning activities
across new infrastructure.
Our environmental performance includes data from the following operations:
• CSL Seqirus, three manufacturing facilities – Australia, the UK and the US;
• CSL Behring, five manufacturing facilities – Australia, Germany, Switzerland, the US and China;
• CSL Plasma operations, including testing laboratories and plasma centres, across China, Germany, Hungary and the US;
• administrative and R&D operations co-located with our manufacturing facilities; and
• the respective head offices for CSL Behring (King of Prussia, US), CSL Plasma (Boca Raton, US) and CSL Limited
(Parkville, Australia).
Indicator
Unit
Energy consumption 2
Petajoules (PJ)
Greenhouse gas emissions 3
Metric kilotonnes CO2-e (KT)
Water consumption
Gigalitres (GL)
Total waste
Metric kilotonnes (KT)
Waste recycling rate4
%
19-20 1, 5
(April to March)
20-21 1, 5
(April to March)
21-22 1, 5
(April to March)
3.79
341
4.25
66.75
46
3.74
324
4.44
59.18
39
3.92
347
4.67
55.54
38
1 Data reported are inclusive of CSL Behring and CSL Seqirus manufacturing facilities, CSL Plasma and CSL Behring headquarters.
2 Includes Scope 1 and 2 energy sources. Scope 1 energy sources are fossil energy sources supplied or used onsite. Scope 2 energy sources are electricity and steam
supplied to site.
3 The majority of greenhouse gas (GHG) emitted from CSL’s operation is carbon dioxide (CO2). In the US, Germany, the UK and Switzerland, GHG emission factors
are used to calculate CO2 emissions only. In Australia, GHG emission factors used by CSL calculate carbon dioxide, nitrous oxide and methane emissions. Total
emissions for Australian facilities are expressed as carbon dioxide equivalents (CO2-e).
4 The recycling rate represents the proportion of total waste generated that is either reused or recycled.
5 CSL Plasma uses validated factors to calculate electrical power, gas and water consumption. Utility invoices were used to establish these factors and calculate
natural gas, electricity and water consumption for all CSL Plasma centres. Utility invoices were also used for the two CSL Plasma Logistic centres in Knoxville (US)
and Union (US). CSL Plasma uses the contracted waste hauler monthly data to calculate the total yearly waste impact. In the absence of hauler information,
a factorial is applied to calculate the estimated waste impact per volume of plasma collected
Environmental metrics
Climate change and resilience
With the development of CSL’s 2030 emissions reduction
target, the following metrics are under review.
Intensity measure. Previously CSL has reported
environmental performance utilising an intensity measure
drawn from environmental inputs (absolute numbers)
against group revenue. With the establishment of an
absolute target alternative indicators will be explored
to support measuring performance against our targets.
Scope 3 emissions. These are indirect emissions resulting
from value chain activities including the supply of goods
and services, distribution of products by third parties and
employee travel. In 2022/23, CSL expects to disclose its scope
3 boundary and baseline data.
Our Scope 1 and 2 emissions profile
CSL’s Scope 1 greenhouse gas emissions come from the
combustion of fossil fuels. This is primarily burning natural
gas to generate steam at manufacturing facilities. Scope 2
emission are from purchased electricity and to a lesser extent
purchased steam. Sites in Switzerland and the UK currently
purchase electricity from renewable sources.
CSL Limited
Scope 1 and 2 GHG
emissions 21-22
Scope 1 30%
Scope 2 70%
Climate change poses a risk for the health of the global
population, businesses, communities and the economy.
A warming planet increases the risk of wildfires, rising sea
levels, extreme heat, severe weather and droughts. These
hazards can have a direct effect on population health and
further stress health care infrastructure, including the
network of global manufacturing facilities and warehouses
utilised by CSL in the production of life-saving medicines and
therapies. We recognise the need to limit global warming to
1.5ºC in line with the Paris Agreement in order to reduce even
worst impacts in the long-term, as reiterated in the most
recent Intergovernmental Panel on Climate Change (IPCC).
While we strive to save and improve the lives of our patients
and protect public health, we’ve taken actions to proactively
mitigate and adapt to climate change. Our recent efforts
include undertaking enterprise-wide climate risk and
opportunity assessments in 2019/20 and 2021/22 using the
IPCC Fifth and Sixth Assessment Reports (IPCC AR5 and
IPCC AR6) across our plasma centres, critical suppliers,
manufacturing facilities and warehouses, disclosing against
the CDP (formerly known as Carbon Disclosure Project)
framework, and developing a decarbonisation roadmap.
Climate change affects all aspects of businesses and
communities, both directly and indirectly, with the severity
varying significantly by region. We have identified multiple
opportunities to quantify and lower our greenhouse gas
emissions, and expand knowledge-sharing opportunities
between different functions and geographies to develop
multi-purpose adaptation and mitigation solutions.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 8 Environment
With involvement from CSL staff across our key geographies,
we identified and prioritised physical and transition climate
risks and opportunities referencing CSL’s risk framework
to 2030, with climate scenario analysis informing long-term
changes and potential impacts in climate policy and climate
hazards relevant to our operations.
Primarily focussing on a 2030 timeframe, in line with our
strategy, the materiality of these risks as is predicted today
is currently of low to moderate impact, and we will continue
to regularly monitor and reassess these risks as the effects
of climate change further unfold, with our approach to
management of these risks now embedded in our
Enterprise Risk Management Framework.
The resiliency of our operations is aided by having a
geographically diverse but integrated network of
manufacturing facilities; a reliance on plasma collections
via an expanding network of more than 300 centres across
the US, and also in China, Germany and Hungary; a supply
chain that is actively monitored and risk-managed,
particularly for critical and sole source suppliers involved
in the manufacture of our products; a roadmap for reducing
emissions by 2030; and an emerging need to investigate
how climate change affects supply chain routes that are
dependent on cold-chain transportation.
These efforts ensure we can contribute to limiting global
warming, while continuing to improve the lives of our
patients and protect public health.
We also continue working towards including the
recommendations of the Task Force on Climate-related
Financial Disclosure (TCFD) into future disclosures, giving
consideration to the rapidly evolving standards and
impending release of the International Sustainability
Standards Board’s Climate-related Disclosures (Climate
Exposure Draft) which builds upon the recommendations
of the TCFD and incorporates industry-based disclosure
requirements derived from the Sustainability Accounting
Standards Board (SASB) standards.
Scenarios utilised for analysis
Using scenario analysis
Scenario analysis is an established method of informing strategic planning and is a useful tool for understanding the
strategic implications of climate-related risks and opportunities. CSL uses scenario analysis and resilience testing to
understand the potential impacts that a range of physical and transition risks associated with climate change may
have on CSL’s operations. While scenario planning is an important planning tool for CSL, there are limitations with
scenario analysis and it is difficult to predict which, if any, of the scenarios might eventuate. Scenario analysis is not
an indication of probable outcomes and the assumptions relied upon for the purpose of this analysis may or may not
prove to be correct or eventuate. However, CSL uses scenario assessment to help us understand potential business
outcomes in different scenarios to support with our planning.
Physical
The global warming futures are evaluated using scenarios collectively known as the Shared Socioeconomic Pathways
(SSPs) that offer different narratives regarding socioeconomic trends that could shape the future over time and
associated with distinct global warming trends. The SSPs are from the IPCC Sixth Assessment Report (IPCC AR6).
The SSPs build upon the Representative Concentration Pathways (RCPs) from the IPCC Fifth Assessment Report
(IPCC AR5). We use the RCP scenarios (that are aligned to the SSP scenarios) from the IPCC AR5 for metrics that have
not yet been constructed within the IPCC AR6 models.
The frequency and intensity of chronic and extreme temperature and precipitation patterns and the occurrence of
storm surge events and hurricanes was assessed under two IPCC AR5/AR6 scenarios, namely a moderate emissions
RCP4.5/SSP2-4.5 ‘Current Policies’ pathway (the world meets current climate targets and pledges, but does not quite
meet the Paris Agreement target), and a high emission ‘Limited Action’ RCP8.5/SSP5-8.5 global inaction pathway.
We assessed multiple time horizons from now to 2050. We used multiple climate datasets and models to inform
future implications across CSL operations and geographies.
Scenarios explored the change in extreme weather events, chronic and extreme heat, flood and extreme rain and water
scarcity over the applicable time horizons.
Transition
We conducted scenario analysis on CSL manufacturing sites across the US, Europe and Asia Pacific. We used two
scenarios from the Network for Greening the Financial System (NGFS) for 2030, 2040 and 2050. These were a low
emission 1.5°C-aligned ‘Net Zero 2050’ pathway that limits global warming to 1.5°C through stringent climate policies
and innovation, reaching net zero CO₂ emissions around 2050, and a moderate emission 3-4°C ‘Current Policies’
pathway that assumes that only currently implemented policies are preserved, leading to high physical risks.
These scenarios have been selected to capture the spread (diversity) of potential future combination edge-cases.
The potential financial exposure of CSL’s emissions have been projected using the trends of carbon and energy
prices inherent to the decarbonisation scenarios. These were quantified by exploring alternate combinations of
CSL’s decarbonisation actions and the decarbonisation actions on a global scale. We used metrics and information
including carbon and energy prices, fuel mix, existing policies and regulations, targets and commitments,
and regionally-significant sectoral emissions.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Energy and emissions
Our target
The main sources of energy for CSL’s manufacturing facilities
are electricity and natural gas. Steam and compressed air
are imported onto the Marburg, Germany, facility as energy
sources. Small amounts of diesel, gasoline and heating oil
are also used as energy sources. For our CSL Plasma network
of centres, electricity is the main source of energy. Combined,
our manufacturing facilities and CSL Plasma’s centres
contribute most of CSL’s energy consumption and therefore
greenhouse gas emissions.
As part of the environment pillar of our strategy, we set out
to develop targets based on validated data sets and robust
baselines. As a result of this effort, and in alignment with
Science Based Targets initiative, we commit to a 40%
reduction in absolute Scope 1 and 2 emissions by 2030, using
the average of CSL’s FY19-21 emissions as the basis. Further,
we intend to ensure that suppliers who contribute 67% of our
Scope 3 emissions have set Science Based Targets aligned
Scope 1 and Scope 2 reductions by 2030.
Following the adoption of our sustainability strategy
in 2021 we have undertaken detailed analysis of our current
and projected footprint and the short and near-term
decarbonisation levers available. As a result, we have set
emissions reduction targets for 2030.
For CSL, this is an escalation of our approach to environmental
responsibility, recognising and responding to the risk global
warming poses to our patients, donors, communities and
public health.
Scope
Target*
1
2
3
40% reduction by 2030
on our baseline
For 67% of emissions, applicable
third parties have set science-based
Scope 1 and 2 targets by 2030
Key
abatement
levers over
the target
timeframe
• Increased energy efficiency
• A push towards more
• Revised procurement standards
• Best-in-class facility design for
renewable power
and award criteria
greenfield sites and new buildings
• Re-designing some of our
• Supplier enablement through
• Switching fuels to less carbon
manufacturing sites
advocacy and education
intensive energy sources
• Increased energy efficiencies
• Strategic partnerships to innovate
and collaborate
Definitions
*Excludes Vifor
Scope 1 controlled by the company, for example, emissions from combustion in owned or controlled boilers,
furnaces, or vehicles.
Scope 2 emissions are released as a result of one or more activities that generate electricity, heating, cooling
or steam that is consumed by the facility, but that do not form part of the facility.
Scope 3 emissions are the result of activities from assets not owned or controlled by the reporting organisation,
but that the organisation indirectly affects in its value chain. Scope 3 emissions include all sources not within
an organisation’s Scope 1 and 2 boundary.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 8 Environment
Embedding environmental
considerations into key
business decisions
In November 2020, CSL Seqirus announced the
build of the only cell-based influenza vaccine
manufacturing facility in the Southern Hemisphere,
producing seasonal and pandemic influenza
vaccines, CSL Seqirus proprietary adjuvant and
Australian antivenoms and Q-Fever vaccine.
The facility will be built at a green-field site in
Tullamarine, Victoria, Australia and is currently
designed to feature best-in-class sustainable
design features including, to name a few:
• onsite renewable energy generation;
• electrification of plant to reduce reliance
on natural gas;
• heat recovery from waste management processes;
• reclaim water reuse;
• embedded night setback operating mode for suitable spaces when activity
levels are low;
• electric car and bicycle charging stations;
• detailed waste management and circular economy plans to minimise
construction and operations waste; and
• reuse of recycled materials in construction.
The facility is expected to be operational in 2026 and will seek certification
to the Green Building Council Australia’s Green Star building rating.
Innovation and sustainability intertwine in Marburg, Germany
The new research and development (R&D) campus in Marburg, Germany, is one of the places where CSL will shape
the future. For the first time, more than 500 R&D colleagues along with external partners can collaborate under one
roof in state-of-the-art work spaces and in highly innovative laboratories.
While the new building seeks to fuel R&D innovation, innovation has also been fundamental in the design of the
building. An innovative sustainability-driven heating and cooling feature has been installed. Heating and cooling will
be provided by heat pumps plus an innovative ice storage system, which will be one of the largest ice storage facilities
in Europe. At the end of the heating period, the water in the ice storage begins to freeze and this stored cold can be
used at no expense for cooling during warmer periods. This system reduces primary energy consumption by about
37% below the minimum standard required by law.
Completion of the building is planned for September 2022, and the new building is expected to reduce CO2 emissions
by 1,870 tonnes per annum.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Waste and packaging
CSL’s objective is to reduce the amount of waste that is
generated throughout the production and use of all
products; to reuse and recycle waste as far as possible;
and to dispose of the residual waste responsibly. The amount
of waste produced and how it is handled varies between
CSL’s different facilities according to production processes
and available disposal options.
A large part of the waste stream is made up of glass,
plastics, cardboard, wooden pallets and other types
of packaging, which is necessary for ensuring product
safety of pharmaceuticals. Disposal of packaging presents
particular challenges for pharmaceutical companies
because packaging such as single-use plastics, glass
syringes and vials are not recyclable and must be
disposed of in a safe manner.
CSL’s operations in Europe dispose of almost all waste
by recycling or incineration. In Australia, CSL is a signatory
to the Australian Packaging Covenant and reports regularly
on plans and progress to minimise waste. There is also a
wide variety of waste recycling programs at our US facilities.
However more can be done to reduce waste to landfill across
our Australian and US operations and this remains a focus
area for CSL in the near-term.
Over the past year CSL has actively sought ways to reduce
paper and cardboard packaging usage and waste, including
the following examples:
• The replacement of patient information leaflets from the
product pack with an electronic leaflet has been initiated
for the Japanese market;
• At our Marburg, Germany, site, the implementation
of digitally printed packaging for smaller markets,
has helped to reduced over-ordering and packaging
material write-offs; and
• New generation labels that use 30% less material were
utilised to launch an albumin-based product in China.
CSL Plasma innovation drives
sustainability
With US regulatory clearance of the Rika Plasma
Donation System, Terumo Blood and Cell
Technologies and CSL Plasma continue working
together to deliver this new plasma collection
platform at CSL Plasma US collection centres.
With this implementation, we expect to see reduced
environmental impacts; strengthen our
commitments and reputation with donors, patients
and communities; and raise awareness and
involvement toward sustainable practices.
We expect the following to occur at a high level,
to minimise end-to-end production of waste through
removal, reduction and recycling.
• There will be less biohazard waste as the
disposables used on the Rika device have a smaller
footprint. Initial data analysis indicates a Rika-
generated plasma donation reduces biowaste
by 68g (0.15lb) per donation.
• We will see less cardboard waste as less packaging
material is required for the Rika separation set,
which are components involved to separate blood
cells from plasma.
• Terumo will be providing a digital interface and we
will be moving to more paperless processes.
With millions of plasma donations collected each
year and a growing footprint of operations, these
represent a significant reduction of biowaste.
Further analysis will be undertaken as we begin
rollout of devices across the CSL Plasma centre
network in the US.
Optimised ethanol recycling
CSL’s Bern, Switzerland, site utilises ethanol in production steps and for
cleaning and disinfecting equipment, work tools and rooms.
Post use, ethanol is purified by distillation and reused. This reprocessing
requires five times less energy than industrial ethanol production and
the proportion of internally recycled ethanol is 77%, reducing the
amount of ethanol purchased and transported to CSL Behring.
In 2021, a distillation plant was optimised with the aim of processing the same amount of ethanol with less
steam and thus saving natural gas. This was achieved by lowering the differential pressure. In addition, the heat
exchanger for feed preheating was replaced. This allows more energy to be recovered from the plant’s hot
wastewater. With this optimisation, the system requires 2’448’980 kWh less energy in the form of natural gas
per year (equivalent to brewing over 171 million cups of coffee).
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22
9 Social
Our greatest opportunity to contribute to society is through the development of new
therapies for serious unmet medical needs and through the continued supply of life-saving
vaccines and plasma and protein-based therapies.
From developing new, innovative therapies for diseases to enabling greater access to life-saving vaccines, protecting the
safety and wellbeing of our patients and communities around the world sits at the center of our purpose as a business.
This includes a commitment to a positive experience and the trust of our donors, who make vital therapies possible,
and to continuous engagement with the stakeholders we depend upon to fulfill our promise.
In addition to material topics featured, our strategic
sustainability focus areas include:
• strengthening societal health through access
to our existing products and therapies and
investment in innovation;
• being trusted by donors through a focus on their
experience and wellbeing, and their communities;
and
• enhancing our industry position as a patient-
focussed and public health leader.
US$9.9 billion
over the reporting period distributed in
supplier payments, employee wages and
benefits, shareholder returns, government
taxes and community contributions*
*Limited assurance by Ernst & Young.
Plasma donors
CSL Plasma is one of the world’s largest collectors of human
plasma and a leader in plasma collection. CSL Plasma’s
14,000 employees commit to excellence and innovation
across the full cycle of plasma collection, including donor
screening, the donation process, plasma testing and
logistics, ensuring plasma is available for the manufacturing
of life-saving therapies. Plasma donors continue to be the
critical link to ensure tens of thousands of people can live
normal, healthy lives.
The company has strengthened and grown its footprint
to support a positive donor experience and reliable
plasma supply as patient demand has increased. Donor
management and safe, compliant and efficient plasma
collection remain integral to a quality supply of raw material.
More than 300 CSL Plasma centres provide the plasma that
is the foundation of life-saving and life-enhancing therapies,
as well as serving as a positive force in local communities,
supporting donor wellbeing and the surrounding area.
As one example, for a second year in a row, CSL Plasma
provided vouchers to plasma donors in the U.S. to access
influenza vaccines at no cost at a local pharmacy during the
US autumn and winter seasons, when influenza is most likely
to manifest and spread.
CSL Plasma donor experience and profile
The socio-demographic background of US CSL Plasma
donors remains diverse. Based on self-reported survey data
administered through the newly deployed CSL Plasma
mobile app (1 Sept 2021 to 30 June 2022), CSL Plasma donors
provided details on occupational status^:
• 55% described themselves as working full-time.
• 20% described themselves as unemployed, inclusive
of full-time parents, donors who are not looking for work
or the unemployed.
• 15% described themselves as part-time.
• 3% described themselves as students.
• 7% described themselves as other (e.g. military, retired).
Of those plasma donors surveyed, 95% are willing to donate
again, and 91% of plasma donors are willing to refer a friend
to donate plasma at their CSL Plasma centre.^
95%
of plasma donors
are willing to
donate again^
91%
of plasma donors
are willing to refer
a friend to donate
plasma at their CSL
Plasma centre^
^ Limited assurance by Ernst & Young. CSL Plasma updated post-donation survey questions in September 2021 to use a Likert response scale
from a prior yes or no answer. Data is based on 2.9 million survey responses. The percentages for willing to donate and refer a friend are
comprised of total number of respondents who selected the top two (4 and 5) of five numbers on the Likert scale.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Advancing innovation at CSL Plasma
In March 2022, the US Food and Drug Administration (FDA) provided regulatory clearance of the Rika Plasma Donation
System developed by Terumo Blood and Cell Technologies.
CSL and Terumo announced a collaboration in 2021 to deliver the new plasma collection platform at CSL Plasma
US collection centres. CSL Plasma will begin implementation of the new device as part of the limited market release
at centres in the Denver and Colorado area and then continue with full implementation across all US CSL Plasma
centers during 2022/23.
The Rika system includes technology to support a safe, efficient and improved experience for plasma donors, as well
as an improved employee experience. Additional system features support the collection of more plasma, in shorter
periods of time. This helps us better serve patients who rely on plasma-based therapies.
Benefits of the Rika system include the following.
• It completes one plasma collection in 35 minutes or less on average, enabled by the proprietary design of the
centrifuge to maximise the plasma yield per cycle. When considering prior average CSL Plasma donation times,
this could represent a nearly 30% reduction in average donation time for donors.
• It ensures there’s not more than 200ml of blood outside the donor’s body at one time. This is expected to improve
the donor’s comfort during the donation and reduce occurrence of a red cell loss deferral.
• It is designed with an advanced user interface to guide CSL Plasma front-line employees who operate
the device. Status indicators keep donors informed of their donation progress and allow employees more
information to assist donors.
• The system has built-in safety features that minimise errors and reduce interruptions; and
• It features training modules that can be integrated into any learning management system to efficiently train
operators and technicians.
A clinical trial of the device supported regulatory clearance. Overall, donor satisfaction with the procedure was high
during the trial as donors were pleased with the reduced procedure time and often expressed that they felt better
at the end of the procedure with the new device than they did during previous donations.
Initiatives further support donor experience
Our ability to supply life-enhancing and often life-saving therapies is only made possible by ensuring a positive donor
experience. All our centres operate to the same standards for the management and care of plasma donors.
CSL Plasma has studied several strategies to reduce donor adverse events (AEs), particularly pre-faint or fainting among
first-time donors. An analysis of donor adverse events was recently published with the trade association in the medical
journal Transfusion, including data from CSL Plasma and two other companies. This data helped to inform our approach.
We have completed two controlled studies evaluating promising interventions based on information in the medical
literature. A cross-functional team has been examining the results, and will implement an approach to further reduce
AEs in the next financial year. Our focus is to minimise overall AEs, especially among first-time donors. We have also
increased proactive health and wellbeing messaging for plasma donors through traditional and digital channels,
to support plasma donation and healthier lifestyles.
Another study involving a three-year analysis of donor deferrals from 255 centres in the US was published in the
Journal of Clinical Apheresis in October 2021. Plasma deferrals occur when initial and periodic onsite screening of
donors renders them unable to undertake a plasma donation.
The study analysed a total of 4,587,923 events from 255 plasma donation centres (an average of 9% of total donations)
over a three-year period (1 April 2017 to 31 March 2020). Most donor deferrals were due to particularly high blood
pressure, elevated pulse, low protein and low haematocrit – which is the make-up of blood with blood cells.
Although rates of deferrals in other categories have been slightly increasing over time, they comprise a small
percentage. Donor education regarding healthy lifestyle choices may improve overall donor health, decrease deferrals
and increase source plasma supply. CSL Plasma’s donor app, website and social media channels help raise awareness
of and educate donors on lifestyle choices.
4949
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 9 Social
Product safety and quality
The development, manufacture and supply of high-quality
and safe products is critical to our ability to continue to
protect public health, save lives and improve the health and
wellbeing of patients with rare and serious diseases. CSL
employs an independent quality function that strives to
maintain the highest standards through the use of global
quality standards.
These are reflected in global policies, global and local
procedures, as well as global electronic systems to support
management of the quality processes. In 2021/22, CSL’s
quality systems, plasma collection and manufacturing
operations were subject to 406 regulatory agency
inspections* around the world. These independent
inspections resulted in no suspensions or terminations
of a licence to market a product in any market in which
CSL is active and confirm that the quality systems
established globally by CSL are effective and in line
with regulatory agency expectations.
406
regulatory inspections of our manufacturing
facilities and plasma collection centres* with
no suspensions or terminations of a licence
to market a product in any market in which
CSL is active
To assure continued consistent high-quality materials
from our partners, CSL Behring and CSL Seqirus
conducted a combined 678 quality regulatory audits*
of suppliers worldwide, comprised of on-site, virtual,
and paper-based audits.
Over the reporting period, there were 12 reported cases
of suspected counterfeit products from CSL customers.
CSL was able to confirm that three of the 12 cases were
counterfeit products, three investigations could not confirm
the counterfeit status and six remain under investigation.
Over the reporting period, as a precautionary measure, six
lots of PRIVIGEN and four lots of HIZENTRA were voluntarily
withdrawn from the US market due to a higher rate of
allergic/hypersensitivity type reactions. Hypersensitivity and
anaphylactic reactions are a known risk with immune globulin
products. Across our operations, there were no safety-related
recalls of finished product initiated by a regulator.
Oversight and management of pharmacovigilance and
clinical safety affords our patients the opportunity to fully
realise the benefits of our products. CSL’s Global Clinical
Safety and Pharmacovigilance function continues to assure
the safety of patients and clinical study participants while
further deepening its capabilities and improved quality
outputs. Compliance metrics have remained at high levels.
Over the reporting period, CSL Behring and CSL Seqirus
pharmacovigilance quality assurance (PVQA) performed
a total of 69 pharmacovigilance (PV) audits:
• 20 on internal systems and processes across our sites,
including affiliates; and
• 49 on third parties that undertake PV responsibilities
on CSL’s behalf in various countries all over the world.
5050
None of these audits resulted in an outcome which affected
our ability to supply product.
CSL Behring underwent several GMP inspections which
focused on patient safety and pharmacovigilance. None of
these inspections resulted in an outcome which affected
patient safety nor resulted in critical findings.
Supply continuity and resilience, including
human rights and responsible supply chain.
To meet the global demand for CSL’s lifesaving medicines,
we are focused on driving a global mindset and creating
an end-to-end operation organisation that is modern and
scalable, from plasma collection through to our patients.
As an industry, collecting plasma during the global
pandemic has been challenging. COVID-19 has presented
the plasma industry with many challenges with the ability
to collect plasma having been the most adversely affected.
CSL Plasma has continued to implement a number of
targeted initiatives focussing on growing plasma collections
for example, donor fees were increased industrywide. We
enhanced our operating and marketing efforts to attract
not only new donors but also lapsed donors, both of which
are an important source of future donations. We also provided
influenza vaccination vouchers to US plasma donors
following the completion of two plasma donations made
within a calendar month and introduced new technologies,
such as our donor app, to improve the donor experience.
CSL has continued to implement strategic partnerships with
contract manufacturers to establish services that increase
capacity and mitigate risks. Several new partnerships
entered the commercial supply phase which has enabled
CSL to spread singled sourced product supply over multiple
manufacturers. These partnerships will also deliver greater
capacity to support CSL’s growth plans.
Many projects are in various stages of the technology transfer
process and when delivered will further increase supply
reliability and resilience of CSL’s most important products.
Over the reporting period, CSL enhanced its third-party risk
management (TPRM) digital tool, by means of amended or
additional questions for supplier self-assessments, which
was released in 2021. The tool assesses risks across new
vendors. Since the launch of TPRM we have loaded 170
vendors and only two were identified as high risk.
CSL is also in the process of rolling out DisasterAware,
a digital platform that provides early indication warnings
to our procurement team of natural and human-induced
risks based on the physical location of our vendors. This will
go live in the second half of 2022.
CSL also operates an on-going process of vendor audits and
we conducted 678 such audits during the reporting period.
We continue to refine our tools in this space and this level
of effort reflects our continued focus on understanding our
suppliers and our commitment to enabling a reliable supply
of our therapies.
678
quality audits of suppliers*
*Limited assurance by Ernst & Young.
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 In December 2021, CSL’s second, Board-approved, public
Modern Slavery Statement under new Australian laws was
published by the Australian regulator. To help minimise
disruption to product manufacturing and supply, and
to support our efforts to identify, remedy and ultimately
prevent risks of instances of modern slavery occurring in our
supply chain. CSL has joined the Pharmaceutical Supply
Chain Initiative (PSCI) to collaborate with like-minded
organisations across a number of social and environmental
aspects including human rights and labour practices. We
also continue to adapt our processes to assess and mitigate
third party risk prior to onboarding. For existing suppliers we
have commenced a process of communicating our
expectations for business conduct by sharing (and in some
case undertaking training on) our Third Party Code of
Conduct, which was published in September 2021.
Anyone with information about potential misconduct is
encouraged to ‘Speak Up’ under the CSL Speak Up Policy.
This includes all of CSL’s current and past employees,
directors, contractors, customers, suppliers and associates.
All reports made under this policy will be received and
treated sensitively and seriously, and will be dealt with
promptly, fairly and objectively.
From 1 July 2021 to 30 June 2022, no reports related to human
trafficking or slavery and forced labour in our global
operations were received.
You can read more on CSL’s modern slavery response in our
2021 Statement on CSL.com (Our Company > Corporate
Responsibility > Key Publications).
Health security
A measure of the trust we have built is our position as a
global leader in influenza pandemic preparedness and
response. Thirty governments around the world rely on CSL
Seqirus for pandemic influenza preparedness, including the
US, the UK and Australia. CSL Seqirus also provides pandemic
response commitments to the World Health Organization.
Our government partners reserve pandemic vaccine doses
from our facilities to protect their populations in the event
of an influenza pandemic. CSL Seqirus also supplies
pre-pandemic vaccine stockpiles that could be deployed to
first-responders upon a declaration of an influenza pandemic.
CSL Seqirus has three state-of-the-art manufacturing
facilities on three different continents, together with a global
fill and finish network located close to our end markets.
CSL Seqirus passed two key milestones in the US in 2022.
In February, CSL Seqirus renewed a multi-year agreement
with the Biomedical Advanced Research and Development
Authority (BARDA), a division of the Office of the Assistant
Secretary for Preparedness and Response (ASPR) within the
U.S. Department of Health and Human Services (HHS).
The agreement provides influenza vaccines and adjuvants
for pre-pandemic stockpiling or for manufacture to support
rapid response to an influenza pandemic or other public
health emergency.
In June, CSL Seqirus announced that its manufacturing
facility in Holly Springs, North Carolina, has successfully
achieved all criteria required to establish domestic
manufacturing capability for cell-based seasonal and
pandemic influenza vaccines as outlined by BARDA.
With this recognition, the US Government confirms that
CSL Seqirus has established and will maintain the required
pandemic readiness to deliver 150 million doses of cell-based
pandemic influenza vaccine within six months of an
influenza pandemic declaration in the US. CSL Seqirus’
adjuvanted egg-based pandemic and pre-pandemic
vaccines have now been augmented, with the first ever
adjuvanted cell-based pandemic vaccine, AUDENZ™
(Influenza A(H5N1) Monovalent Vaccine). This vaccine is
designed to help protect people six months of age and older
against influenza A(H5N1) in the event of a pandemic and is
approved for use by the US Food and Drug Administration
(FDA). Construction work has also commenced on Seqirus’
new A$800+ million influenza vaccine manufacturing facility
in Australia. The facility will utilise the same innovative
cell-based technology used at our Holly Springs site, which
has the potential for the rapid ramp-up of vaccine production
in the event of a pandemic emergency.
Access to our products
Our products provide substantial and meaningful value to
patients, healthcare providers, health insurance payers and
healthcare systems around the world.
We are proud of these contributions and seek to ensure that
patients and communities have access to a reliable supply
of biopharmaceuticals and vaccines.
We work with governments, health insurance payers and
other stakeholders to support timely and appropriate market
entry and access, in order to enable appropriate patients to
benefit from our therapies as quickly as possible. We value an
ongoing dialogue with policymakers, advocacy groups, and
other stakeholders to understand and respond to their needs
and expectations.
We articulate and communicate comprehensive evidence
on the value of our innovations to inform access and
reimbursement decisions, and we provide patient assistance
programs and support advocacy efforts that improve access
to care and affordability.
In 2021/22, CSL’s investment for humanitarian access
programs and product support initiatives totalled
US$17.8 million.* In the US, access programs are critical to
patients who are uninsured, underinsured or who cannot
afford therapy.
US$17.8 million
supporting product access across
the world*
We are also committed to pricing practices that reflect
the value our products bring to patients and society. To
that end, we evaluate real-world and clinical trial data that
demonstrate the clinical benefits our therapies deliver, as
well as the cost savings they provide to overall healthcare.
We also consider patient needs and preferences and how our
therapies improve patients’ quality of life and productivity.
* Limited assurance by Ernst & Young. Dollar value is a sub-set of CSL’s
total community contributions.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 9 Social
Supporting patients with haemophilia
In May 2022, CSL Behring announced a ground-
breaking new partnership with the World Federation
of Hemophilia (WFH).
Commencing in 2023, CSL Behring will donate 500
million international units (IUs) of coagulation factor
therapy to the WFH as part of its continued support
of the WFH Humanitarian Aid Program. The donation,
which includes product specifically manufactured
for the purposes of being donated, will create
consistent and reliable access to treatment for
people living with bleeding disorders in more than
60 developing countries.
By manufacturing product specifically for the purposes
of donation, the coagulation factor therapy will have a
standard shelf life of three years, thus enabling greater
access to these life-saving therapies for people around
the world. The donated product will be delivered twice
a year for five years.
In addition to the product donation, the partnership
supports progress in improving the diagnosis and
treatment of bleeding disorders through the WFH’s
Global Alliance for Progress (GAP). CSL Behring will
provide financial support for logistics costs and training
programs designed to address unmet needs for people
living with haemophilia in developing countries who
are undiagnosed, untreated, or undertreated.
This substantive partnership extends CSL Behring’s
longstanding commitment to the WFH, with CSL
Behring currently in its fifth multiyear commitment
to donate coagulation factor therapies to the WFH.
The role of real world evidence (RWE)
in driving vaccine value and access
Unlike other viruses, such as human papillomavirus
(HPV) or measles, the influenza virus can change
significantly each year, making it critical for us to assess
seasonal vaccine effectiveness through real world
evidence, year after year.
As a company on the front line of influenza prevention,
CSL Seqirus is committed to using RWE to continually
evaluate the clinical benefit and cost effectiveness of
our innovative seasonal influenza vaccines compared
to more traditional options. Health agencies use RWE
to make decisions about which influenza vaccines to
recommend for certain populations, providing access
for the most vulnerable people through government-
funded immunisation programs.
In June 2021, CSL Seqirus published a study showing
cost-effectiveness of FLUCELVAX QUADRIVALENT
in people aged 50 years and above in the UK, lending
support to the UK Governments decision to include
this cohort in its national influenza vaccination
program during the COVID-19 pandemic.
In June 2022, the US Advisory Committee on
Immunisation Practices of the CDC evaluated the body
of evidence including clinical and observational data to
preferentially recommend three adjuvanted or higher
dose influenza vaccines, including FLUAD, for people
65 years of age and older in the US. This decision will
also help improve access to these vaccines for ethnic
and racial minorities in this vulnerable age group
Social investment
CSL’s approach to community support is guided by our Code of Responsible Business Practice and supplemented by our
Global Community Contributions Policy. The policy applies to all CSL businesses and employees and is intended to be
implemented to guide decision-making and management of any form of community contribution, financial or by other
means. The core of the policy is our community contributions framework, which sets out our key focus areas of support:
patient communities, innovation and science and local communities. In 2021/22, CSL contributed US$50 million to support
global efforts where we operate.
US$50
million in
community
contributions
Sub focus areas
50%^
to patient
communities
49%^
to innovation
and science
2%^
to local
communities
• Enhancing quality
of life for patients in
the conditions our
therapies treat.
• Improving access to
our biological medicines.
• Advancing knowledge
in medical and scientific
communities.
• Supporting community
efforts where we live
and work.
• Fostering the next
generation of medical
researchers.
• Supporting communities
in times of emergency.
^Due to rounding, percentages do not total 100.
5252
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22
PNG expanded antivenom access –
moving beyond roads, to air and
the sea
Now in its fourth year, the Papua New Guinea
(PNG) Snakebite Partnership continues to address
an important public health issue through strategic
partnerships resulting in new and innovative ways
to improve access to antivenoms. CSL Seqirus
collaborates with the Australian High Commission
in PNG, the PNG Department of Health, and the
University of Melbourne to donate up to 600 vials
of antivenom per year, which are distributed
across PNG via trained healthcare workers. This
improves the chances of timely administration
of antivenom to potentially help save lives in a
country with one of the highest snakebite rates
in the world.
During the COVID-19 pandemic, the program has
found innovative ways to open up access to more
remote parts of the country through collaborations with St John Ambulance on
the roads of Central Province, Manolos Aviation to leverage the airspace above
Lae and beyond, and the Youth with a Mission (YWAM) Medical Ship that
serves communities along the southern coast of PNG.
YWAM Medical Ship in PNG
Standing up for Ukraine
CSL and its employees are saddened by the violence and devastating toll caused by the war in Ukraine and have joined
the statements and initiatives to support the people and patients affected by the war.
To aid with humanitarian efforts, CSL participated in Global Citizen’s Stand Up For Ukraine campaign in April 2022,
under the auspices of the European Commission and governments. CSL CEO and MD, Paul Perreault, personally
engaged in this initiative and stated our strong commitment to human health and human rights, and CSL pledged a
donation of our life-saving medicines, for a value of more than €1.6 million to support humanitarian efforts in the region.
We have worked with the European institutions and governments, and coordinated with Ukrainian authorities to
deliver this donation through the European Union RescuEU program and the EU Civil Protection Mechanism to
Ukraine. Our life saving medicines will help treat infected wounds, provide treatment for people exposed to hepatitis B,
help control bleeds with blood-clotting therapies and treat those suffering from shock following serious injury, severe
burn or surgery.
In addition, we have also worked with several international organisations, such as WHO, to provide a number of our
life-saving medicines. We continue in close dialogue with other international partners active in Ukraine and the region,
such as Direct Relief and UNICEF, as well as European and local patient and clinician organisations, to stay close to
evolving patient needs and provide access to our medicine supply network as they strengthen their overall support
capabilities in the area.
We also initiated an employee donation match and CSL Plasma donor campaign, raising a combined US$249,154
for several charitable organisations providing on-ground emergency relief for war-affected communities and in
surrounding countries.
We continue to monitor risks of the war in Ukraine and stand ready to assist where our capabilities and therapies can
provide assistance.
5353
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 10 Governance
CSL Limited’s Board and management team maintain high standards of corporate
governance as part of CSL’s commitment to maximise shareholder value. This is achieved
through promoting effective strategic planning, risk management, transparency and
corporate responsibility.
Governance structure
Board composition
Our approach to corporate governance and the role it plays
goes well beyond meeting our compliance obligations.
We believe that our governance framework fosters our high
performing and respectful culture while underpinning CSL’s
Values of Patient Focus, Innovation, Integrity, Collaboration
and Superior Performance. The Board has a formal charter
documenting its membership, operating procedures and
the allocation of responsibilities between the Board and
management. CSL’s Board charter is central to the governance
framework at CSL as it embodies our corporate purpose,
strategy and values and defines when we are successful.
CSL’s Board of Directors is responsible for overseeing the
management of CSL and providing strategic direction. It
monitors operational and financial performance, strategic
human resource matters and approves CSL’s budgets and
business plans. It is also responsible for overseeing CSL’s risk
management, financial reporting and compliance framework.
The Board has delegated the day-to-day management of
CSL, and the implementation of approved business plans
and strategies, to the CEO and Managing Director, who
in turn may further delegate to senior management.
The following diagram shows the governance framework of
CSL. Robust processes are in place to ensure the delegation
flows through the Board and its committees to the CEO and
Managing Director, the Global Leadership Group (GLG) and
into the organisation. The CEO and Managing Director and
GLG have responsibility for the day-to-day management of
the Group. Our governance framework also aligns the flow
of information and accountability from our people, through
the management levels, to the Board and ultimately our
shareholders and key stakeholders.
Throughout the year there were nine directors on the Board.
At the date of this report, there are nine directors on the
Board, comprising seven independent non-executive
directors, one non-independent non-executive director
and one executive director.
Since 1 July 2021 to the date of this report, the following
changes to directorships occurred:
• Professor Duncan Maskell and Ms Alison Watkins were
appointed to the Board on 18 August 2021 and were elected
as directors at the 2021 Annual General Meeting (AGM);
• Dr Brian McNamee was re-elected as a director and Chair
of the Board at the 2021 AGM; and
• Professor Andrew Cuthbertson retired from the Board as
an Executive Director on 1 October 2021 and was re-elected
as a Non-Executive Director at the 2021 AGM.
The Board is focused on maintaining an appropriate mix of
skills and diversity in its membership. This includes a range
of skills, experience and background in the pharmaceutical
industry, international business, finance and accounting,
and management, as well as gender diversity. A detailed
matrix of Board skills is available in CSL’s 2021/22 Corporate
Governance Statement available at https://www.csl.com/
our-company/corporate-governance.
Key Stakeholders, including Shareholders
Board
Committees
Audit and Risk
Management
Corporate
Governance
and Nomination
Human
Resources and
Remuneration
Innovation and
Development
Securities
and Market
Disclosures
CEO & Managing Director
Global Leadership Group
Company Secretary
Our People
Values
Integrity
Patient Focus
Collaboration
Innovation
Superior
Performance
Code of Responsible Business Practice
5454
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Board of Directors
Brian McNamee AO
MBBS, FTSE
Chair and Independent
Non-Executive Director
Director of CSL Limited since February
2018 and Chair from October 2018.
Paul Perreault
BA (Psychology)
Non-independent Executive Director
Director of CSL Limited since February
2013, and appointed Chief Executive
Officer and Managing Director in
July 2013.
Bruce Brook
BCom, BAcc, FCA, MAICD
Independent Non-Executive Director
Director of CSL Limited since August 2011.
Dr McNamee has deep executive experience in the biopharmaceutical industry,
with a focus on strategy and creating long-term shareholder value.
Dr McNamee was the Chief Executive Officer and Managing Director of CSL from 1990
until 2013. Since leaving his executive role at CSL, Dr McNamee has served as a senior
advisor to private equity group Kohlberg Kravis Roberts. He has also pursued a number
of private equity and interests in small cap healthcare companies, and in 2014 served
on the panel of the Australian Government’s Financial System Inquiry. In 2009, he was
made an Officer of the Order of Australia for service to business and commerce.
Other directorships and offices (current and recent):
– Chair of Geoff Ogilvy Foundation (since May 2021); and
– Former Chair of GenesisCare Limited (from July 2019 to June 2022).
Board Committee memberships:
– Member of the Innovation and Development Committee;
– Member of the Corporate Governance and Nomination Committee; and
– Member of the Securities and Market Disclosure Committee.
Mr Perreault has more than 37 years of experience across both the global biotech
and pharmaceutical industries.
He was appointed Chief Executive Officer and Managing Director of CSL Limited in
July 2013, and was appointed to the CSL Board of Directors the same year. Since then,
CSL has grown to become the third largest biotech company in the world, with more
than 30,000 employees bringing lifesaving medicines to people in more than
100 countries.
Mr Perreault, who previously served as CSL Behring’s president, joined CSL in 2004
with the acquisition of Aventis Behring. Prior to CSL, he spent more than 15 years in
key senior roles at Wyeth-Ayerst Laboratories, now part of Pfizer. Mr Perreault holds a
bachelor’s degree in psychology from the University of Central Florida and completed
advanced business management training at the Kellogg and Wharton schools
of business.
Other directorships and offices (current and recent):
– Director of the US Pharmaceutical Research and Manufacturers of America
Association (PhRMA) (since December 2020).
Board Committee memberships:
– Member of the Innovation and Development Committee; and
– Member of the Securities and Market Disclosure Committee.
Mr Brook has an extensive breadth of executive experience in diverse industries,
including mining, finance, manufacturing and chemicals. In particular, Mr Brook
has valuable insight and experience in relation to risk, capital discipline, change
management, corporate culture and creating shareholder value.
Mr Brook was chief financial officer of WMC Resources Limited from 2002 to 2005.
He also held key executive roles including deputy chief finance officer of ANZ Banking
Group Limited, group chief accountant of Pacific Dunlop Limited and general
manager, Group Accounting positions at CRA Limited and Pasminco Limited.
Other directorships and offices (current and recent):
– Director of Djerriwarrh Investments Limited (since August 2021);
– Director of Guide Dogs Victoria (since November 2018);
– Director of Incitec Pivot Limited (since December 2018); and
– Director of Newmont Corporation (since October 2011).
Board Committee memberships:
– Chair of the Audit and Risk Management Committee; and
– Member of the Corporate Governance and Nomination Committee.
5555
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22
10 Governance
Megan Clark AC
BSc (Hons) PhD
Independent Non-Executive Director
Director of CSL Limited since
February 2016.
Andrew Cuthbertson AO
BMedSci, MBBS, PhD, FAA,
FTSE, FAHMS
Non-independent
Non-Executive Director
Director of CSL Limited since
October 2018, and appointed Senior
Adviser to the CEO in July 2020.
Dr Clark has significant executive and Non-Executive experience across a broad range
of sectors, including scientific research, health, investment banking and financial
services, education and mining. Through her roles, Dr Clark brings a broad strategic
perspective and global experience, with a focus on risk and proven health, safety and
environment and technology performance.
In 2014 Dr Clark was made a Companion of the Order of Australia for eminent service
to scientific research and development.
Dr Clark was chief executive of the Commonwealth Scientific and Industrial Research
Organisation (CSIRO) from 2009 until November 2014. Prior to joining CSIRO, she was
a director at NM Rothschild and Sons (Australia) and held senior positions at BHP,
including vice president (Technology) and vice president (Health, Safety and Environment).
Other directorships and offices (current and recent):
– Deputy Chancellor of Monash University (since January 2021);
– Chair of the Australian Space Agency Advisory Board (since January 2021);
– Member of the Global Advisory Council of the Bank of America Corporation
(since December 2019);
– Director of Rio Tinto Limited and Rio Tinto Plc (since November 2014);
– Member of the Australian Advisory Board of the Bank of America (since July 2010);
– Former Head of the Australian Space Agency (from June 2018 to December 2020); and
– Former Director of Care Australia Limited (from May 2015 to June 2020).
Board Committee memberships:
– Chair of the Human Resources and Remuneration Committee;
– Member of the Corporate Governance and Nomination Committee; and
– Member of the Innovation and Development Committee.
Professor Cuthbertson has over 35 years’ experience in medical research and biotech
development with large biopharmaceutical companies and medical organisations.
He also has Non-Executive director experience.
Professor Cuthbertson joined CSL in April 1997 as the director of research. Prior to
CSL, he was a senior scientist at Genentech Inc., a biotechnology company dedicated
to pursuing ground-breaking science to discover and develop medicine for people
with life-threatening diseases. After completing medical training at the University of
Melbourne and a PhD in immunology at the Walter and Eliza Hall Institute in Australia,
Professor Cuthbertson spent five years doing molecular biology research as a staff
member at the Howard Florey Institute in Melbourne, Australia and the National
Institutes of Health in Maryland, US. In 2016, he was made an Officer of the Order
of Australia and appointed Enterprise Professor at the University of Melbourne.
Other directorships and offices (current and recent):
– Member of the Council of the University of Melbourne (since January 2020);
– Director of the Grattan Institute (since January 2019); and
– Director of the Centre of Eye Research Australia (since March 2017).
Board Committee membership:
– Chair of the Innovation and Development Committee; and
– Member of the Corporate Governance and Nomination Committee.
5656
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Ms Hewson is a former investment banker with over 35 years’ experience in the finance
sector. She was previously an executive director of Schroders Australia Limited and has
extensive financial markets, risk management and investment management expertise.
She has long-term Non-Executive experience in a number of sectors bringing a
breadth of experience and insight on strategy, capital management and portfolio
optimisation through cycles, financial and non-financial risk, social value,
organisational culture and the changing external environment.
In 2009, Ms Hewson was made an Officer of the Order of Australia for her services
to the broader community and to business.
Other directorships and offices (current and recent):
– Director of Reserve Bank of Australia (since April 2021);
– Director of Infrastructure SA (since January 2019);
– Former Member of Federal Government Growth Centres Advisory Committee
(from January 2015 to May 2021);
– Former Director of BHP Group Limited and BHP Group Plc (from March 2010
to November 2019); and
– Former Trustee Westpac Foundation (from May 2015 to May 2019).
Board Committee memberships:
– Chair of the Corporate Governance and Nomination Committee;
– Member of the Audit and Risk Management Committee; and
– Member of the Human Resources and Remuneration Committee.
Professor Maskell has wide-ranging international experience in science and
commerce, with a particular focus in research, academia and entrepreneurship.
Professor Maskell is the vice-chancellor of the University of Melbourne. Prior to this he
was senior pro-vice-chancellor at the University of Cambridge in the UK and has also
held roles at the University of Oxford, Imperial College London and Wellcome Biotech.
Professor Maskell has extensive experience across the private sector, reflecting his
passion for the commercialisation of research initiatives. He has co-founded several
biotech companies, including Arrow Therapeutics, which was sold to biopharmaceutical
company AstraZeneca, and Discuva, which was sold to Summit Therapeutics. He has
also served as a Non-Executive Director of Genus Plc, a FTSE 250 company.
Professor Maskell holds a Master of Arts and a Doctor of Philosophy from the University
of Cambridge.
Other directorships and offices (current and recent):
– Director of the Grattan Institute (since November 2018);
– Vice-Chancellor of the University of Melbourne (since October 2018);
– Director of Melbourne Business School (since October 2018);
– Director of the Group of Eight Limited (since October 2018); and
– Director of Universities Australia Limited (since October 2018).
Board Committee membership:
– Member of the Innovation and Development Committee.
Ms McDonald has significant executive and Non-Executive experience in a number
of sectors including law, medical research, manufacturing and chemicals. Through
these roles, Ms McDonald brings experience and insight on financial markets, risk
and compliance and change management.
Ms McDonald is a former lawyer with over 30 years’ experience in the legal sector.
She was previously a partner of Ashurst, specialising in mergers and acquisitions and
corporate governance. She held the role of National Head of Mergers and Acquisitions
and was Chair of the Corporations Committee of the Business Law Section of the Law
Council of Australia and a member of the Australian Takeovers Panel for nine years.
Other directorships and offices (current and recent):
– Member of Melbourne University Law School Foundation Board (since October 2021);
– Director of Nanosonics Limited (since October 2016);
– Director of Nufarm Limited (since March 2017); and
– Director of the Walter & Eliza Hall Institute of Medical Research (since October 2016).
Board Committee memberships:
– Member of the Audit and Risk Management Committee; and
– Member of the Human Resources and Remuneration Committee.
Carolyn Hewson AO
BEc (Hons), MA
Independent Non-Executive Director
Director of CSL Limited since
December 2019.
Duncan Maskell
MA, PhD, FMedSci, Hon Assoc RSVC
Independent Non-Executive Director
Director of CSL Limited since August 2021.
Marie McDonald
BSc (Hons), LLB (Hons)
Independent Non-Executive Director
Director of CSL Limited since August 2013.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 10 Governance
Alison Watkins AM
BCom
Independent Non-Executive Director
Director of CSL Limited effective from
August 2021.
Fiona Mead
LLB (Hons), BComm
Company Secretary and Head
of Corporate Governance
Board committees
Ms Watkins brings deep experience to our Board through the executive and Non-
Executive roles she has held across industries, including manufacturing, agriculture,
consumer goods, retail and financial services.
Ms Watkins was most recently the group managing director of ASX-listed Coca-Cola
Amatil Limited, where she was responsible for operations in Australia, New Zealand,
Indonesia and across the South Pacific region.
Ms Watkins holds a Bachelor of Commerce from the University of Tasmania, is a fellow
of the Institute of Chartered Accountants, the Financial Services Institute of Australasia,
and the Australian Institute of Company Directors.
Other directorships and offices (current and recent):
– Director Wesfarmers Limited (since September 2021);
– Chancellor, University of Tasmania (since July 2021);
– Director of Reserve Bank of Australia (since December 2020);
– Director of Centre for Independent Studies (since December 2011);
– Former Director of Business Council of Australia (from August 2015 to October 2021); and
– Former Group Managing Director of Coca-Cola Amatil Limited (from March 2014
to May 2021).
Board Committee memberships:
– Member of the Audit and Risk Management Committee; and
– Member of the Human Resources and Remuneration Committee.
Ms Mead was appointed Company Secretary and Head of Corporate Governance
effective June 2018. Previously, she was the company secretary and a member of the
executive leadership team at Tabcorp Holdings Limited. Prior to that, Ms Mead was
the company secretary at Asciano Limited, and earlier, assistant company secretary
at Telstra. Fiona began her career as a lawyer with law firm Ashurst.
Ms Mead is a fellow of the Governance Institute of Australia and a graduate member
of the Australian Institute of Company Directors.
The Board has established a number of standing committees as a mechanism for considering detailed issues and, where
appropriate, making recommendations for consideration by the Board. These committees have charters setting out matters
relevant to the composition, responsibilities and membership of each committee.
5858
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 Leadership team
Our Global Leadership Group is responsible for driving company performance so that we can keep our promises to our
patients, our employees and our shareholders. They have earned their roles because of their experience, achievements,
unwavering ethics and commitment to our core values.
Paul Perreault
BA (Psychology)
Chief Executive Officer
and Managing Director
Greg Boss
JD, BS (Hon)
Executive Vice
President, Legal and CSL
Group General Counsel
Paul was appointed to the CSL Board in February 2013 and was
appointed as the Chief Executive Officer and Managing Director in
July 2013. He joined a CSL predecessor company in 1997 and has held
senior roles in sales, marketing and operations with his most recent
prior position being President, CSL Behring.
Paul has also worked in senior leadership roles with Wyeth, Centeon,
Aventis Bioservices and Aventis Behring. He was previously chair of
the global board for the Plasma Protein Therapeutics Association.
Paul has had more than 37 years’ experience in the global
healthcare industry.
The Harvard Business Review named Paul among the Top 100
Performing CEOs in the world during this fiscal year. See above
for further biographical details.
Greg was appointed Group General Counsel in 2009 and is
responsible for worldwide legal operations for all CSL Group
companies. He joined CSL in 2001, serving as general counsel
for what became the CSL Behring business.
In addition to his legal role, Greg is also responsible for overseeing
global Risk Management and Compliance for the Group as well
as global Corporate Communications.
Prior to joining CSL, Greg was vice president and senior counsel
for CB Richard Ellis International, after working 10 years in private
legal practice. In 2016, Greg received the World Recognition of
Distinguished General Counsel from the Directors Roundtable,
and in 2017 Greg received the Leadership in Law award from the
Burton Foundation.
Bill Campbell
BSc (Business
Administration)
Executive Vice
President, Chief
Commercial Officer
Bill was appointed Executive Vice President, Chief Commercial
Officer in September 2017. He has responsibility for a variety of
global functions, including sales, marketing, commercial
development, medical affairs and policy, advocacy and government
affairs. Prior to being appointed to his current role, Bill led CSL
Behring’s North American commercial operations. He has more
than 35 years of diverse pharmaceutical and biotechnology
experience across a range of therapeutic areas, including oncology,
women’s health, vaccines and plasma proteins. Bill has held senior
management positions at a number of pharmaceutical and
biotechnology companies.
Mark Hill
BA (Organisational
Management)
Executive MBA
(Information Technology
Management)
Executive Vice
President, Chief Digital
Information Officer
Mark Hill, chief digital information officer at CSL leads the enterprise-
wide Digital Technology organisation and its accompanying strategy.
Mark plays a key role in how CSL manages plasma donors, connects
with patients, virtually collaborates and drives greater efficiencies
in operations and the rest of the CSL organisation.
He is a global IT leader with extensive experience in utilising enabling
technology to deliver efficiency, productivity, quality and solutions
for patients and public health.
Prior to joining CSL, he was Senior Vice President and Chief
Information Officer at Gilead Sciences, where he led the IT
organisation during a period of rapid growth for the company and
delivered key initiatives that encouraged collaboration and new ways
of working. With more than 30 years of experience, Mark also held
leadership roles with Merck and Schering-Plough earlier in his career.
He earned his Bachelor of Science degree in Organizational
Management from Tusculum College and his Executive MBA in
Information Technology Management from Christian Brothers
University. Mark is also a US Army veteran.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 10 Governance
Joy Linton
BComm; F. Fin; GAICD
Chief Financial Officer
Joy was appointed Chief Financial Officer in March 2021.
Prior to joining CSL, Joy was chief financial officer and executive
director at Bupa, a global health insurance company based in the
UK, and earlier served as the general manager of health services
for Bupa UK.
Joy has over 30 years’ experience in branded consumer businesses
across insurance, healthcare and fast-moving consumer goods
as a global and strategic chief financial officer.
Paul McKenzie
PhD (Chemical
Engineering)
Chief Operating Officer
Bill Mezzanotte
MD, MPH
Executive Vice
President, Head
Research &
Development and
Chief Medical Officer
Elizabeth Walker
BA, MS (Organisational
Development and
Leadership)
Executive Vice
President, Chief Human
Resources Officer
Paul was appointed Chief Operating Officer in June 2019 and
leads CSL’s global end-to-end operations organisation and its
accompanying strategy. He has responsibility for manufacturing,
quality, engineering, supply chain, procurement and environment,
health and safety, as well as CSL Plasma and its network of collection
centres in the US, China and Europe. Paul also has responsibility for
CSL Seqirus.
Prior to joining CSL, Paul served as executive vice president of
Pharmaceutical Operations and Technology at Biogen. With more
than 25 years of experience, Paul held various senior roles in research
and development and manufacturing for Johnson & Johnson,
Bristol-Myers Squibb and Merck & Co.
Paul holds a Bachelor of Science degree in chemical engineering
from the University of Pennsylvania and a PhD in chemical
engineering from Carnegie Mellon University. He was elected
to the National Academy of Engineering in 2020.
As the Head of Research & Development (R&D) and Chief Medical
Officer, Bill is responsible for developing and executing CSL’s R&D
strategy and portfolio, creating the pipeline and R&D capabilities
that will help the CSL Behring and CSL Seqirus businesses grow
in the decades ahead. These R&D capabilities include identifying
and developing all scientific platforms, skills and expertise
necessary for success in rare and serious diseases and vaccines.
Bill, who has been leading R&D since October 2018, initially joined
CSL as head of clinical development in 2017. Prior to CSL, Bill was
senior vice president and therapeutic area head for the respiratory
unit for Boehringer Ingelheim and spent 16 years with AstraZeneca
in research and development, assuming roles of increasing
leadership and management responsibility across multiple
therapeutic areas. Bill obtained his MD at the University of
Pennsylvania and a Master of Public Health degree from Johns
Hopkins University. He is board certified in internal medicine,
pulmonary medicine, critical care medicine and sleep medicine.
Since 2020, Bill has served as a member of the Board of Directors
of the Philadelphia-based University City Science Center and in 2021
he joined the Board of Directors for BELLUS Health.
Elizabeth Walker leads Global Human Resources for the CSL Group
of Companies and its people and culture strategy, supporting more
than 30,000 employees around the world.
Elizabeth joined CSL in 2016 and was appointed Chief Human
Resources Officer in December 2017. Previously, she held a variety
of HR leadership positions at Campbell Soup Company, most
recently as Vice President of Global Talent Management.
With a career spanning more than 30 years, she has extensive
human resources and management consulting expertise and
a distinguished record of results in growth businesses and M&A
environments and within a diverse set of industries, including
healthcare, financial services and consumer products.
Elizabeth holds a Master of Science degree in organization
development and leadership from St. Joseph’s University and
a Bachelor of Arts degree from Carnegie Mellon University
Allan Wills, former Executive Vice President, Strategy and Business Development, resigned from CSL effective
30 November 2021.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 From 1 July 2021 to 30 June 2022, 295 reports were identified
for the attention of management through our global hotline.
For substantiated allegations, corrective actions were taken
to the extent warranted. For matters closed during the
reporting period, no allegations resulted in any regulatory
action or action by law enforcement authorities.
In addition, over the reporting period, an annual assessment
of bribery and corruption risk was conducted. This was
achieved by means of a standardised questionnaire that
was completed and the responses reviewed with the GCC.
During the reporting period, the assessments did not
identify any material issues with the CSL’s management
of corruption risks.
295
hotline reports received, as at 30 June 2022,
with no allegations resulting in regulatory
action or action by law enforcement
authorities.
Fair competition
In April 2022, the Romanian Competition Council (RCC)
issued a decision fining five pharmaceutical companies,
including CSL Behring GmbH, as well as the representative
trade association of the plasma protein sector (PPTA) for
claimed coordinating actions on the market.
CSL Limited strongly disagrees with and contests the RCC’s
findings and sanctions against the five companies and the
trade association, and CSL has appealed the decision and will
vigorously defend against the claims.
For more than 100 years, CSL has earned its reputation as a
trusted, reliable and ethical global organisation. CSL is proud
of its robust compliance program and has established a track
record of operating in compliance with all applicable laws.
Political contributions
Over the reporting period, CSL contributed a total of A$9,100
to political organisations in Australia solely for attendance
at events including policy briefings, lunches, boardroom
lunches and dinners. In all other regions, CSL made no
political contributions.
More at CSL.com (Our Company > Corporate Responsibility >
Marketplace).
Ethics and transparency
While our CSL Values serve as the directional compass of
our work, our Code of Responsible Business Practice (Code)
provides a more detailed map to deliver on our promise to
patients and public health in ways that exemplify the highest
standards of conduct throughout the organisation.
CSL’s Code fosters a culture that rewards high ethical
standards, personal and corporate integrity and respect
for others.
Following the publication of the Board- endorsed 4th-edition
Code on 1 July 2021, all employees were required to undertake
training on the Code and CSL’s new ethics-based decision-
making tool. These two e-learning modules were made
available in 14 languages to cater for CSL’s global workforce.
In certain aspects of our business, such as the marketing of
our products, our relationships with healthcare professionals
or healthcare organisations and our research and
development, we have made further commitments to
comply with both local and internationally accepted
pharmaceutical industry codes of conduct.
We expect third parties with which we work to comply with
the applicable local laws and regulations of the countries in
which they operate, and to observe all of the principles set
out in our Code.
We have internal control systems to ensure financial
statements comply with the applicable local laws of the
countries in which we operate and to prevent fraud and
other improper conduct.
CSL’s Code can be found on CSL.com (Our Company >
Corporate Governance > Code of Responsible
Business Practice).
Anti-Bribery and anti-corruption
CSL businesses and employees are prohibited from directly
or indirectly offering, paying, soliciting or accepting bribes
or giving or receiving personal favours, financial or other
rewards or inducements in exchange for making business
decisions. This prohibition applies regardless of the value
of the reward or inducement. CSL policy also prohibits
facilitation payments.
CSL operates in a diverse and complex marketplace where
bribery and corruption are risks that could expose the
organisation and employees to possible prosecution, fines
and imprisonment. CSL has a number of commercial
arrangements with governments and related agencies
across various geographies.
Market practices are governed by company-specific policies
and procedures. Internal compliance mechanisms and
control systems are directly supported by our Global Ethics
and Compliance team and subject to additional oversight
by CSL’s Global Compliance Committee (GCC), regional
committees, and CSL’s Audit and Risk Management
Committee of the Board.
Based on these controls, CSL considers our overall risk
relating to corruption to be low and are committed to
ensuring full compliance in how we conduct our operations
across all regions in which we operate and those we are
seeking to enter.
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CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 10 Governance
Sustainability performance
FTSE4Good
CSL’s environmental, social and governance (ESG)
performance has been recognised by the FTSE4Good
Index Series, a leading sustainability index, for the last
11 years.
MSCI
As of June 2022, CSL received an MSCI ESG Rating of A.
MSCI focuses on companies ESG rated performance
in each sector to help institutional investors more
effectively integrate ESG considerations into their
investment processes, as well as manage, measure,
and report on ESG mandates.
Sustainalytics
As of April 2021, CSL’s ESG risk rating overall score
is 25.2 with an ESG risk rating category of medium
(on a 5-point scale from negligible to severe), ranking
14 out of 372 in the biotechnology sector (1st equals
lowest risk).
Sustainalytics provides analytical ESG research, ratings
and data to institutional investors and companies.
Disclosure
As a publicly listed company on the Australian Securities
Exchange (ASX), CSL has obligations under Australian law
and the ASX Listing Rules. Subject to limited exceptions, we
must continuously disclose to the ASX information about CSL
that a reasonable person would expect to have a material
effect on the price or value of CSL securities.
CSL has a policy that sets clear guidelines and describes
the actions that the directors and all employees should
take when they become aware of information that may
require disclosure.
6262
Corporate governance
Throughout 2021/22, CSL’s governance arrangements were
consistent with the ASX Corporate Governance Council’s
Corporate Governance Principles and Recommendations
(4th edition). Our 2021/22 Corporate Governance Statement
has been approved by the Board and is available on CSL.com
(Our Company > Corporate Governance).
The Board continually reviews governance at CSL to ensure
that our arrangements remain appropriate in light of
changing expectations and general developments in good
corporate governance.
Risk management
CSL has adopted and follows a detailed and structured
Enterprise Risk Management Framework (ERMF) to ensure
that risks in the CSL Group are identified, evaluated,
monitored and managed. This ERMF sets out the risk
management processes, internal compliance and
monitoring requirements, governance processes and
structures including roles and responsibilities for different
levels of management, the matrix of risk impact and
likelihood for assessing risk, the three lines of accountability
for risk and risk management reporting requirements.
The ERMF has been established to provide reasonable
assurance that:
• any material exposure to risk is identified and adequately
monitored and managed; and
• significant strategic, emerging, financial, managerial and
operating risk-related information is accurate, relevant,
timely and reliable.
Further details of CSL’s risk management framework are
contained in CSL’s Corporate Governance Statement.
A description of CSL’s material risks and key risk
management activities for each risk can be found in Our
Material Risks on page 24.
Tax transparency
While CSL’s roots are proudly Australian, CSL is a truly global
company, with more than 90% of our revenues and profits
derived outside Australia. We separately report on our global
tax footprint, as part of our tax transparency reporting.
We are subject to the different tax regimes that apply in each
of those countries and comply with applicable taxation laws
in all the jurisdictions in which we operate, including the
OECD Country-by-Country reporting measures.
CSL’s approach to tax is underpinned by our Value of Integrity.
This is consistent with our commitment to complying with
all tax laws in the countries in which we operate. CSL has a
low appetite for tax risk and does not engage in aggressive
tax planning.
CSL supports efforts to promote prevention of tax avoidance
and to improve tax transparency in order to support a fairer
economy and ensure there is confidence in the robustness
of country tax regimes.
Operating with transparency forms a core part of CSL’s tax
management philosophy and as such our annual tax
transparency reports can be found on CSL.com
(Our Company > Corporate Responsibility).
CSL Limited Annual Report 2021/22CSL Limited Annual Report 2021/22 11 Financial Performance
Contents
Directors’ Report
Auditor’s Independence Declaration
Consolidated Statement of Comprehensive Income
Consolidated Balance Sheet
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
64
69
98
99
100
101
102
141
142
63
CSL Limited Annual Report 2021/22 Directors’ Report
The Board of Directors of CSL Limited (CSL) has pleasure in presenting their report on the consolidated entity for the year
ended 30 June 2022.
1.
Principal activities, strategy and
operating model
The principal activities of the consolidated entity during the
financial year were the research, development, manufacture,
marketing and distribution of biopharmaceutical products
and vaccines.
CSL is a leader in global biotechnology, and develops and
delivers innovative medicines that save lives, protect public
health and help people with life-threatening medical
conditions to live full lives. CSL’s strategy is delivered through
its five strategic objectives for 2030: focus; innovation;
efficiency and reliable supply; sustainable growth; and digital
transformation. More detail on CSL’s performance against
its 2030 strategic objectives can be found in Performance
and Strategy.
CSL’s operating model for its businesses leverage
multifunctional teams that connect to share best practice.
CSL’s operating model is based around four key value
creation activities: early stage research, product translation,
manufacturing and patient access. CSL’s commercial and
functional areas operate at a global level, with the Global
Leadership Group responsible for the day-to-day management
of the group and delivery of CSL’s strategic objectives. More
detail on CSL’s operations can be found in Our Company
and Performance and Strategy.
On 9 August, CSL acquired Vifor Pharma (Vifor). As at the
date of this report, the integration of Vifor to align with CSL’s
operating model is underway. Further details on the Vifor
business and the acquisition can be found on page 5 of this
report and Note 2 and Note 23 of the Financial Statements.
2. Operating and financial review
CSL discloses financial performance primarily by business.
This provides the most meaningful insight into the nature
and financial outcomes of CSL’s activities and facilitates
greater comparability against industry peers. Information
on the operations and financial position for CSL and likely
developments in the Group’s operations in future financial
years is set out in the Operating and Financial Review (OFR).
The OFR consists of the Chair and CEO messages (including
the Vifor Acquisition), Our Performance and Strategy,
Our Company, Our Material Risks, Our Future Prospects
and Our Governance accompanying this Directors’ Report.
3. Directors
The directors who served at any time during 2021/22 or up
until the date of this Directors’ Report were Dr Brian McNamee
AO, Mr Paul Perreault, Professor Andrew Cuthbertson AO,
Mr Bruce Brook, Ms Carolyn Hewson AO, Dr Megan Clark AC,
Ms Marie McDonald, Professor Duncan Maskell and
Ms Alison Watkins AM.
Further details of the current directors are set out in the
Governance section of CSL’s 2021/2022 Annual Report or
on CSL.com. These details include the period for which
each director held office up to the date of this Directors’
Report, their qualifications, independence, experience and
particular responsibilities, the directorships held in other
listed companies since 1 July 2019 and the period for which
each directorship has been held.
Professor Duncan Maskell and Ms Alison Watkins were
appointed as a Non-executive Directors of CSL with effect
from 18 August 2021.
4. Company Secretary
Ms Fiona Mead, BCom/LLB (Hons) FGIA, GAICD, was
appointed and commenced in the position of Company
Secretary and Head of Corporate Governance on 4 June 2018
and continues in office as at the date of this report. Ms Mead
was previously the company secretary and a member of the
executive leadership team at Tabcorp Holdings Limited.
Prior to that, she was the company secretary at Asciano
Limited. Ms Mead also served as assistant company secretary
at Telstra Corporation.
5. Director’s attendance at meetings
The Board meets as often as necessary to fulfil its role.
Directors are required to allocate time to CSL to perform
their responsibilities effectively, including adequate time
to prepare for Board meetings. During the reporting year,
the Board met 10 times, with all of those meetings held
in Australia.
Members of the Global Leadership Group and other
members of senior management attend Board meetings
by invitation. Attendance at Board and standing Board
committee meetings during 2021/22 is set out in Table 1
below. Due to COVID-19 restrictions, the directors also
leveraged virtual technologies to participate in focused
sessions on the CSL Group’s operations inside and outside
Australia and meet with local management.
64
CSL Limited Annual Report 2021/22 Table 1: 2021/22 Director Attendance at Board and Committee meetings
Board of
Directors
Audit and Risk
Management
Committee
A
10
10
10
10
10
10
9
9
10
B
10
10
10
10
10
10
8
9
10
A1
5
5
5
3
B
5*
5
5
4*
4*
5
1*
3
5*
Securities
and Market
Disclosure
Committee
A
3
B
3
3
3
Human
Resources and
Remuneration
Committee
Innovation and
Development
Committee
Corporate
Governance
and Nomination
Committee
A2
7
7
7
5
A
4
4
4
4
2
B
7*
2*
7
7
7*
7
1*
5
7*
A
4
4
4
4
4
B
4
4*
4*
4
4
4*
4
4*
4*
B
4
4
4
4
2
2*
4*
B McNamee
B Brook
C Hewson
M Clark
A Cuthbertson
M McDonald
D Maskell
A Watkins
P Perreault
A Number of meetings held whilst a member.
B
Number of meetings attended. Board Committee meetings are open to all directors to attend. Where a director attended a meeting of a committee
of which they were not a member, it is indicated with an asterisk*.
1. One of the Audit and Risk Management Committee meetings was held jointly with the Human Resources and Remuneration Committee.
2. One of the Human Resources and Remuneration Committee meetings was held jointly with the Audit and Risk Management Committee.
6. Dividends
On 16 August 2022, the directors resolved to pay a final dividend of US $1.18 per ordinary share, 10% franked, bringing dividends
per share for 2022 to US $2.22 per share. In accordance with determinations by the directors, CSL does not operate a dividend
investment plan.
Dividends paid during the year were as follows:
Dividend
Final dividend for year ended 30 June 2021
Date paid
30/09/2021
Franking
per share
10% franked at
30% tax rate
Amount
per share
US$
1.18 cents
Interim dividend for year ended 30 June 2022
06/04/2022
Unfranked
1.04 cents
Total
dividend
US$
$537.7m
$501.0m
Dividends are determined after period-end and announced with the results for the period. Interim dividends are determined
in February and paid in April. Final dividends are determined in August and paid in October. Dividends determined are not
recorded as a liability at the end of the period to which they relate.
7. Developments in operations in future
8. Significant changes and
years and expected results
subsequent events
The OFR sets out information on CSL’s business strategies
and prospects for future financial years, and refers to
likely developments in CSL’s operations and the expected
results of those operations in future financial years. Certain
information regarding developments in operations in future
years and expected results of those operations is excluded
because it is likely to result in material prejudice to the Group.
Other than as disclosed in the OFR, the directors are not
aware of any significant changes in the consolidated entity’s
state of affairs during the year or to the Group’s principal
activities during the year.
Other than the acquisition of Vifor (see Vifor Acquisition on
page 5 of this report and Note 2 and Note 11 of the Financial
Statements) and information as disclosed in Note 23 of the
Financial Statements, the directors are not aware of any other
matter or circumstance which has arisen since the end of
the financial year which has significantly affected or may
significantly affect the operations of the Group, results
of those operations or the state of affairs of the Group
in subsequent financial years.
65
CSL Limited Annual Report 2021/22
Directors’ Report
9. EHS and sustainability performance
10. Directors’ shareholdings and interests
The interests of the directors in the shares, options and
performance rights of CSL are set out in the Remuneration
Report – Tables 11 and 12 for executive key management
personnel (KMP) and Tables 17 and 18 for Non-Executive
Directors. It is contrary to Board policy for KMP to limit
exposure to risk in relation to these securities. From time
to time the Company Secretary makes inquiries of KMP
as to their compliance with this policy.
11. Directors’ interests in contracts
Section 13 of this report sets out particulars of the Director’s
Deed entered into by CSL with each director in relation
to access to Board papers, indemnity and insurance.
12. Performance rights and options
As at 30 June 2022, the number of unissued ordinary shares
in CSL under options and under performance rights are set
out in Note 6 and Note 19 of the Financial Statements. Holders
of options or performance rights do not have any right, by
virtue of the options or performance rights, to participate
in any share issue by CSL or any other body corporate or in
any interest issued by any registered managed investment
scheme. The number of options and performance rights
exercised during the financial year and the exercise price paid
to acquire fully paid ordinary shares in CSL is set out in Note 6
of the Financial Statements. Since the end of the financial
year, no shares were issued under CSL’s Performance Rights
Plan. Since the end of the financial year, there has been no
change to the information contained in Note 8 or Note 19
to the Financial Statements. Since the end of the financial
year, 6,378 Restricted Share Units have been forfeited due
to participant cessation of employment. There has been
no change to the information contained in Note 18 to the
Financial Statements.
CSL has an Environmental, Health and Safety (EHS)
Management System that ensures its facilities operate to
industry and regulatory standards. This system includes
compliance with government regulations and commitments
for continuous improvement of health and safety in the
workplace, as well as minimising the effect of operations on
the environment. As part of our commitment to continuously
improving our EHS performance, a global review of our
management system against ISO 14001 and 45001 was
conducted this financial year with implementing an update
to the system planned for FY2022/23.
Development, implementation and improvement of employee
health and safety processes and programs continue to focus
on enhancement of a strong and inclusive safety culture. Our
Australian operations continue classification as an established
licensee in respect to CSL’s self-insurance licence as granted
by the Safety, Rehabilitation and Compensation Commission.
CSL continues to operate in compliance with domestic and
foreign laws, regulating environmental, health and safety
obligations. Including all applicable emissions and waste
generation and disposal requirements. Government agency
audits and facility inspections monitor CSL environmental,
health and safety performance. No material findings were
identified over the reporting period.
In 2021, CSL, Parkville (Australia) submitted a remediation
feasibility study and clean-up plan for identified groundwater
contamination to the environmental authority in response
to an EPA clean up notice. The EPA confirmed the site has
complied with the notice requirements. CSL continues
to monitor and engage with EPA on the next steps to close
out this issue.
As part of compliance and continuous improvement in
regulatory and voluntary environmental performance, CSL
continues to report on key environmental aspects, including
energy consumption, emissions, water use and management
of waste as part of CSL’s annual reporting on CSL.com
(see Corporate Responsibility) and submission to the CDP
(previously known as Carbon Disclosure Project). CSL has met
its reporting obligations under the Australian Government’s
National Greenhouse and Energy Reporting Act (2007) and
Victorian Government’s Industrial Waste Management Policy
(National Pollutant Inventory).
Continuously monitoring environmental health and safety
performance, climate change risks, and control measures
means that CSL is ready for new and emerging regulatory
requirements. CSL’s environmental performance is
particularly important and relevant to select stakeholders
and CSL reaffirms its commitment to continue to participate
in initiatives such as CDP’s (climate change and water
disclosures) to help inform investors of its environmental
management approach and performance.
Additional EHS performance details, including workplace
safety, can be found in Our People on page 41.
66
CSL Limited Annual Report 2021/22 13. Indemnification of directors and officers
14. Indemnification of auditors
During the financial year, the insurance and indemnity
arrangements discussed below were in place concerning
directors and officers of the consolidated entity.
CSL has entered into a Director’s Deed with each director
regarding access to Board papers, indemnity and insurance.
Each deed provides:
• an ongoing indemnity to the relevant director against
liability incurred by that director as an officer of CSL or a
related body corporate. The indemnity is given to the extent
permitted by law and to the extent and for the amount that
the relevant director is not otherwise entitled to be, and is
not actually, indemnified by another person or out of the
assets of a corporation, where the liability is incurred in or
arising out of the conduct of the business of that corporation
or in the discharge of the duties of the director in relation
to that corporation;
• that CSL will purchase and maintain an insurance policy
which covers directors against liability as a director and
officer of CSL and its directors. Coverage will be maintained
for a minimum of seven years following the cessation of
office for each director; and
• the relevant director with a right of access to Board papers
in connection with any relevant proceedings.
In addition to the Director’s Deeds, Rule 95 of CSL’s
constitution requires CSL to indemnify each ‘officer’ of CSL
and of each wholly owned subsidiary of CSL out of the assets
of CSL ‘to the relevant extent’ against any liability incurred by
the officer in or arising out of the conduct of the business of
CSL or in the conduct of the business of such wholly owned
subsidiary of CSL or in the discharge of the duties of the
officer, unless incurred in circumstances which the Board
resolves do not justify indemnification. Further details are set
out in the Constitution, available on CSL.com (Our Company >
Corporate Governance).
CSL paid insurance premiums in respect of a contract
insuring each individual director of CSL and each full time
executive officer, director and secretary of CSL and its
controlled entities, against certain liabilities and expenses
(including liability for certain legal costs) arising as a result
of work performed in their respective capacities, to the
extent permitted by law.
To the extent permitted by law, CSL has agreed to indemnify
its auditors, Ernst & Young, as part of the terms of its audit
engagement agreement against claims by third parties
arising from the audit (for an unspecified amount). No
payment has been made to indemnify Ernst & Young during
or since the financial year. No insurance premiums were paid
for Ernst & Young during the financial year.
15. Auditor independence and
non-audit services
CSL may decide to employ the auditor on assignments
additional to their statutory audit duties where the auditor’s
expertise and experience with CSL and/or the consolidated
entity are important.
Details of the amounts paid or payable to the entity’s auditor,
Ernst & Young, for non-audit services provided during the year
are set out below. The directors, in accordance with the advice
received from the Audit and Risk Management Committee,
are satisfied that the provision of non-audit services is
compatible with the general standard of independence for
auditors imposed by the Corporations Act 2001 for the
following reasons:
1. all non-audit services have been reviewed by the Audit and
Risk Management Committee to confirm that they do not
affect the impartiality and objectivity of the auditor; and
2. none of the services undermine the general principles
relating to auditor independence as set out in Professional
Statement F1, including reviewing or auditing the auditor’s
own work, acting in a management or a decision making
capacity for CSL, acting as an advocate for CSL or jointly
sharing economic risks and rewards.
A copy of the auditors’ independence declaration as
required under section 307C of the Corporations Act 2001
accompanies this report.
67
CSL Limited Annual Report 2021/22 Directors’ Report
Ernst & Young and its related practices received or are due to receive the following amounts for the provision of non-audit
services to CSL and its subsidiaries in respect to the year ended 30 June 2022:
AUDIT SERVICES – Ernst & Young Australia
2022
US$
2021
US$
Fees for auditing the statutory financial report of the parent covering the group and auditing the
statutory financial reports of any controlled entities
2,402,268
1,956,994
Fees for other assurance and agreed-upon-procedures services under other legislation or contractual
arrangements where there is discretion as to whether the service is provided by the auditor or another firm
– Assurance services over the 144a bond issuance
– Sustainability assurance
– Agreed-upon procedures and other audit engagements
Fees for other services
Training
Due diligence
Remuneration advisory
326,152
106,873
146,124
39,000
150,295
190,832
–
66,819
90,045
80,000
211,449
357,646
Total fees to Ernst & Young (Australia)
3,361,544
2,762,953
AUDIT SERVICES – Ernst & Young Overseas Member Firms
Fees for auditing the statutory financial report of the parent covering the group and auditing the
statutory financial reports of any controlled entities
Fees for assurance services that are required by legislation to be provided by the auditor
3,678,633
3,556,179
2,721
13,845
Fees for other assurance and agreed-upon-procedures services under other legislation or contractual
arrangements where there is discretion as to whether the service is provided by the auditor or another firm
– Agreed-upon procedures and other audit engagements
Fees for other services
Total fees to overseas member firms of Ernst & Young (Australia)
Total audit and other assurance services
Total non-audit services
Total auditor’s remuneration
The role of the Audit and Risk Management Committee of
the CSL Board of Directors (ARMC) is to oversee the integrity
and quality of half-year and full-year financial reporting
and disclosures. A key responsibility arising from this role
is the appointment of the Company’s independent auditor,
including the selection, review and evaluation of the audit
signing partner(s) and the negotiation of audit fees.
In accordance with its Charter and with CSL’s commitment
to best practice corporate governance practices, the ARMC
regularly reviews the performance of the Company’s
independent auditor.
Matters considered in reviewing the performance of the
Company’s independent auditor in the 2022 financial
year included:
a. the professional qualifications and effectiveness of the
auditor, the audit signing partner(s) and other key
engagement partners;
b. the auditor’s historical and recent performance on the
Company’s audit, including the extent and quality of their
communications with the ARMC;
c. an analysis of the auditor’s known legal risks and significant
proceedings that may impair its ability to perform CSL’s
annual audit;
d. the appropriateness of the auditor’s fees;
e. the auditor’s independence policies and its processes
for maintaining its independence and objectivity;
68
147,474
35,127
77,009
35,224
3,863,955
3,682,257
6,810,245
5,760,891
415,254
684,319
7,225,499
6,445,210
f. the auditor’s tenure as the Company’s independent auditor
and its depth of understanding of the Company’s global
business, operations and systems, accounting policies and
practices, including the potential effect on the financial
statements of the major risks and exposures facing the
Company, and internal control over financial reporting; and
g. the auditor’s capability, expertise and efficiency in handling
the breadth and complexity of CSL’s global operations.
The current audit signing partner for CSL’s auditor, Ernst
& Young is Ms Kylie Bodenham.
In line with an observed trend in many jurisdictions towards
a tenure limit for audit firms, CSL completed its competitive
external audit tender process during FY2021/22. The Company
has recommended the appointment of Deloitte Touche
Tohmatsu as the Company’s external auditor commencing
for the year ending 30 June 2024, subject to regulatory and
shareholder approval.
16. Rounding
The amounts contained in this report and in the financial
report have been rounded to the nearest hundred thousand
dollars (where rounding is applicable) unless specifically
stated otherwise under the relief available to the Company
under ASIC Corporations Instrument 2016/191. CSL is an entity
to which the Instrument applies.
CSL Limited Annual Report 2021/22 Ernst & Young
8 Exhibition Street
Melbourne VIC 3000 Australia
GPO Box 67 Melbourne VIC 3001
Tel: +61 3 9288 8000
Fax: +61 3 8650 7777
ey.com/au
Auditor’s Independence Declaration to the Directors of CSL Limited
As lead auditor for the audit of the financial report of CSL Limited for the financial year ended 30
June 2022, I declare to the best of my knowledge and belief, there have been:
a. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit;
b. No contraventions of any applicable code of professional conduct in relation to the audit; and
c. No non-audit services provided that contravene any applicable code of professional conduct in
relation to the audit.
This declaration is in respect of CSL Limited and the entities it controlled during the financial year.
Ernst & Young
Kylie Bodenham
Partner
16 August 2022
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
69
CSL Limited Annual Report 2021/22
17. Remuneration Report
Dear Fellow Shareholder,
On behalf of the Board of Directors, I am pleased to present
CSL’s Remuneration Report (Report) for the financial year
ended 30 June 2022 (2022). This Report contains detailed
information regarding CSL’s Key Management Personnel
(KMP) for 2022.
In 2022, LTI awards granted to Mr Perreault over the period
October 2017 to September 2020 had partial vesting and he
received shares worth US$7,775,435 (based on the face value
of the award at the date of vesting). Further detail can be
found in sections 6.4 and 8.2.
CSL plays a critical role in the global community – providing
life-saving therapies to people with serious disease, and
vaccines that protect public health. The Board is proud
of the entire CSL team for delivering on this during 2022.
Delivering on our Promise in 2022
Under the leadership of our Chief Executive Officer and
Managing Director (CEO), Mr Paul Perreault, CSL has again
shown resilience in its 2022 results.
Remaining focused on our promise to patients and public
health means we have delivered:
• Net Profit after Tax (NPAT) of US$2,254.7m, in line with
expectations;
• An increase in Revenue of 2% to US$10,561.9m;
• Cashflow from Operations (CFO) of US$2,628.7m;
• An annual Return on Invested Capital (ROIC) of 18.1%;
• Earnings per Share (EPS) of US$4.81;
• Significant growth in Research and Development (R&D)
investment and R&D pipeline progression;
• 27 new plasma centres opened, taking the global total
to 330; and
• Completion of the acquisition of Vifor Pharma AG (Vifor)
on 9 August 2022.
2022 Key Management Personnel Changes
Ms Alison Watkins AM and Professor Duncan Maskell joined
the Board as Non-Executive Directors (NED) in August 2021.
In October 2021, Professor Andrew Cuthbertson AO retired
from his role as Executive Director and Senior Advisor to
the CEO. We are pleased to retain Professor Cuthbertson’s
extensive experience in medicine, science, research and
development and he was re-elected by shareholders as
a non-independent NED.
2022 CEO Remuneration Outcomes
In 2022, Mr Perreault received an increase in Fixed Reward
of 3%, taking this to US$1,803,530 effective 1 September 2021.
Mr Perreault’s short term incentive (STI) target was held at
120% of Fixed Reward and his long term incentive (LTI) target
remained at 400% of Fixed Reward.
Mr Perreault will receive a STI payment of US$3,029,931 for
performance in 2022. The outcome is 140% of Mr Perreault’s
target reflecting below target performance on NPAT, a strong
above target CFO outcome and an individual performance
outcome that was above target. Mr Perreault also led the
team in the successful US$11.7b acquisition of Vifor throughout
2022 which was completed shortly following the end of the
financial year, adding a growth pillar to CSL. Details of these
outcomes can be found in section 6 of the Report.
The 2022 ‘realised’ remuneration for Mr Perreault was
US$12,710,883 and was a 72% decrease from 2021 (full detail
is provided in section 8.2, Table 13). This lower outcome was
driven by the end of legacy LTI Option and Performance
Right awards (granted at fair value) that had previously vested
through until 2021, and saw significant growth in value over
the period from grant to vesting.
2022 CEO Realised Remuneration
0%
20%
40%
60%
80%
100%
● Total Fixed Reward Received
● Total STI Received
● LTI Received – Performance Share Units (2018)
● LTI Received – Performance Share Units (2019)
● LTI Received – Performance Share Units (2020)
● LTI Received – Performance Share Units (2021)
Board Discretion Applied to Remuneration
The Board reviewed the quality of earnings, impact of
COVID-19 and risk management outcomes across the year.
As the Vifor acquisition was not contemplated at the time
of setting the targets at the start of the financial year, the
Board used its discretion to remove the Vifor acquisition
costs and benefits (including favourable hedging activities)
for the calculation of STI outcomes. Further detail is provided
in section 6.1. The Leading and Managing Modifier was not
applied in 2022.
Remuneration Framework Changes
Introduced in 2022
As communicated last year, following a review of the
remuneration framework aimed at ensuring a fit for
purpose design, alignment to our Total Reward Principles
and responding to feedback from our investors, in 2022
the following changes were introduced:
• Maximum STI – Increase of the maximum STI payout
from 150% to 200% of STI target opportunity – driving
our pay for performance philosophy, incentivising for
outperformance and aligning to our global pharmaceutical/
biotechnology peers;
• LTI Performance Measures – Introduction of a second LTI
measure of EPS growth – aligned to shareholder experience.
This second measure ensures focus on long term sustainable
earnings growth and is aligned to market practice and
investor expectations; and
70
Directors’ ReportCSL Limited Annual Report 2021/22 • LTI Vesting Period – Removal of vesting of awards at
years one, two and four to a single point, three year vest.
Responding to investor feedback, this also aligns with
the approach taken by our global pharmaceutical/
biotechnology peers.
During 2022, the Human Resources and Remuneration
Committee (HRRC) reviewed the Malus and Clawback Policy
to ensure appropriate provisions were included and the policy
was in line with market practice. Changes were made to
further strengthen and articulate the circumstances for
which an adjustment may be made.
Remuneration in 2023
As discussed in prior year Reports and across investor meetings,
the Board continues to review and adjust the reward of
Executive KMP to drive reward positioning towards the median
of our global pharmaceutical/biotechnology peer group.
For 2023, the Board has determined that Mr Perreault will
receive a 3.5% increase to Fixed Reward, no change in STI
target and an increase in his LTI target to 450%, from 400%
of Fixed Reward. This change to LTI target is a step towards
bringing our CEO’s Total Target Reward to the median of our
global pharmaceutical/biotechnology peer group, positioning
him at 81% of the median (or 50th percentile) in 2023.
For our remaining Executive KMP, in 2023 an increase to
Fixed Reward of 3.7% and 3.5% will be applied to Ms Joy Linton,
our Chief Financial Officer and Dr Paul McKenzie, our Chief
Operating Officer, respectively. There will be alignment of
the STI targets across the Executive team and Ms Linton’s STI
target will increase to 100% of Fixed Reward. As we continue
to drive towards median Total Target Reward among our
global pharmaceutical/biotechnology peers, both Ms Linton
and Dr McKenzie will have an increase to LTI targets.
Ms Linton’s target will increase to 225% of Fixed Reward
and Dr McKenzie to 425% of Fixed Reward.
Following benchmarking against ASX12 and ASX25 NED
remuneration, there will be an increase in fees of 3% for
all Board and Committee roles, effective 1 July 2022. The
increase enables CSL to offer a competitive fee to attract
and retain experienced directors.
Embedding Environment, Social and Governance
in our Remuneration in Framework
Effective 1 July 2022, we will introduce a global sustainability
measure into our STI plan. In 2023 the measure will include
milestones that:
• Establish a robust program governance process;
• Undertake global initiatives that reduce CO2 emissions;
• Incorporate sustainable design in our new facilities: and
• Engage with our supply partners to achieve a low emission
supply chain.
The measure, with a 5% weighting, will be in addition to
measures already included in the individual key performance
indicators for Executive KMP and Executives. In addition
to the financial measures of NPAT and CFO, this will
ensure collective focus and accountability on our long term
sustainability and global footprint. The weighting of the two
financial measures for Executive KMP remains unchanged.
The weighting of the individual objective component will
be reduced. See section 4 for more detail.
In competing for talent in a global market, it is critical that
we have a remuneration framework that attracts and retains
high quality talent to deliver on our strategy and deliver
results. The Board believes that our current design meets this
requirement. However, we keep this under review each year.
We appreciate the feedback received from investors. As
we evolve our executive remuneration framework we will
continue to review our program both from a competitive
design perspective and ensuring an appropriate target
quantum for Executives that positions us at the median
of our global pharmaceutical/biotechnology peer group.
The Board will review sustainability on an annual basis to
determine the appropriate weighting, measure, target and
alignment to either STI or LTI. As we look to Board succession
we will need to ensure our NED fee pool is set at the
appropriate level.
Thank you to my fellow HRRC members and thank you for
supporting CSL and the patients we serve around the world.
Dr Megan Clark AC
Chair
Human Resources and Remuneration Committee
71
CSL Limited Annual Report 2021/22 Contents
1. CSL Key Management Personnel
2.
2022 Key Management Personnel Remuneration
Outcomes at a Glance
3. Global Remuneration Framework
4. Remuneration Framework Changes in 2023
5. CSL Performance and Shareholder Returns
6. Executive Key Management Personnel Outcomes in 2022
7.
8.
Executive Key Management Personnel Statutory
Remuneration Tables
2022 and 2023 Executive Key Management Personnel
Remuneration
9. Non-Executive Director Remuneration
10. Remuneration Governance
11.
Additional Employee Equity Programs and Legacy
Plan Information
Independent Audit of the Report
The Remuneration Report (Report) has been audited by Ernst & Young (EY). Please see page 142 of the Financial Statements
for EY’s report.
1. CSL Key Management Personnel
This Report sets out remuneration information for CSL’s Key Management Personnel (KMP) which includes Non-Executive
Directors (NEDs), the Executive Director (i.e. the Chief Executive Officer and Managing Director (CEO)) and those key senior
executives who have authority and responsibility for planning, directing and controlling the activities of CSL during the financial
year (together with the Executive Director, herein referred to as Executive KMP). The CSL KMP during the financial year ended
30 June 2022 (2022) and changes to KMP are outlined in Table 1. Each of the KMP listed in Table 1 held their position for the full
reporting period, unless stated otherwise.
Table 1: CSL Key Management Personnel in 2022
Non-Executive Directors
Chairman
Dr Brian McNamee AO
Mr Bruce Brook
Dr Megan Clark AC
Professor Andrew Cuthbertson AO – appointed 2 October 2021
Ms Carolyn Hewson AO
Executive Key Management Personnel
Executive Director and Chief Executive Officer
and Managing Director (CEO)
Mr Paul Perreault
Chief Financial Officer
Ms Joy Linton
Chief Operating Officer (COO)
Dr Paul McKenzie
Professor Duncan Maskell – appointed 18 August 2021
Former Executive Key Management Personnel
Ms Marie McDonald
Ms Alison Watkins AM – appointed 18 August 2021
Executive Director and Senior Advisor to the CEO
Professor Andrew Cuthbertson AO – retired as an Executive
1 October 2021
72
Directors’ ReportCSL Limited Annual Report 2021/22 2. 2022 Key Management Personnel Remuneration Outcomes at a Glance
CEO
• A 3% increase to Fixed Reward (FR)
Other Executive KMP
• A short term incentive (STI) payment of US$3,029,931 – 70% of maximum opportunity
• Partial long term incentive (LTI) vesting during the year of US$7,775,435 (face value at vesting date)
• Received ‘realised’ remuneration of US$12,710,883
J Linton
(Chief Financial
Officer)
• Received an increase to FR of 3.4% (inclusive of the superannuation
guarantee increase)
• STI of US$1,149,742 was paid – 72% of maximum opportunity
• LTI vesting of US$2,361,849 (face value at vesting date)
• ‘Realised’ remuneration in 2022 of US$4,473,431
P McKenzie
(COO)
• Received an increase to FR of 3%
• STI of US$1,273,770 was paid – 65% of maximum opportunity
• Partial LTI vesting of US$3,453,773 (face value at vesting date)
• ‘Realised’ remuneration in 2022 of US$5,788,887
NEDs
The Board and Committee Chair roles received an average increase to fees of 4.2% and an
average 2.8% was applied to Board and Committee member fees (within the existing fee cap)
73
CSL Limited Annual Report 2021/22 3. Global Remuneration Framework
3.1 Global Total Rewards Principles
To deliver on our promise to patients and to protect public health, we rely on our people and we need to ensure a strong
supply of global talent. Our Total Rewards Principles enable us to attract, engage and retain talent, provide us with the flexibility
to address talent challenges in various markets and allow us to compete with other large global pharmaceutical companies.
We motivate our people to deliver their best performance by enabling an approach that integrates market competitive and
differentiated reward programs that align to CSL’s strategy and business objectives.
Common Global Structure
Effort Matters
• We leverage a market-based approach
to offer competitive rewards, balancing
both a global and local view
• We align employee and shareholder
interests, and consider community
expectations
• We benchmark ourselves against the
life sciences industry*
• We have a single pay design for all
senior executives
• We celebrate and recognise both the effort
that is required along the way as well as the
real results created by our employees
Results and Behaviours
Holistic Approach to Well-Being
• We are committed to a pay for performance
culture based on both role requirements
and how the individual performs
• Living our CSL Values is a non-negotiable
expectation
• We foster an environment of well-being that
is multi-dimensional – physical, emotional,
financial and social health
Internal Equity, Inclusive Culture
Simplicity and Clarity
• We reward fairly and competitively
• We strive and monitor for equal pay
for equal work
• We aim to create easy to understand programs
and policies so people value and use them
• We are committed to transparency in our
communications – internally and externally
*CSL Plasma is benchmarked against the Retail Industry
3.2 Remuneration Framework
CSL’s remuneration framework combines elements of traditional Fixed Reward (or base salary), STI and LTI plans with
enhancements to several design factors to suit CSL’s business, a very different business to other companies in Australia,
and with a diverse global employee and shareholder base. Our international footprint requires global leadership and,
with executives based in different countries, we need to ensure our framework is fair, equitable and market competitive
in the countries and industry in which we operate in order to attract and retain highly talented people.
74
Directors’ ReportCSL Limited Annual Report 2021/22 3.2.1 2022 Remuneration Framework Elements for Executive KMP
Fixed Reward (FR)
Short Term Incentive (STI)
Long Term Incentive (LTI)
Purpose
Attract, retain and engage key talent
to deliver our CSL strategy
Structure
Approach
Cash – salary and
superannuation/pension
Paid throughout the year and
reviewed annually
Determined based on the scope,
complexity and responsibilities of the
role, experience and performance
Reviewed through both an internal
and external relativity lens
Peer group – global pharmaceutical/
biotechnology peers or a general
industry view depending on role
(desired positioning at the median)
Reward performance against annual
Key Performance Indicators (KPIs)
– maintaining a focus on underlying
value creation within the business
operations is critical to CSL’s success
and sustainability
Alignment to the longer term
performance and strategy of CSL,
building economic alignment
between Executive KMP and
shareholders over the long term
Cash
Performance Share Units
Paid annually
Maximum payout is 200% of
an Executive KMP’s target STI
opportunity (i.e. STI target
multiplied by 200%)
Outcomes based on business
(60%) and individual performance
measures (40%)
Granted annually with vesting
following the end of the three year
performance period
The performance measures are
Return on Invested Capital –
measured on a seven year rolling
return in the year the award vests
(70%) and Earnings Per Share
Growth – measured over the three
year life of the award (30%)
Peer Group
The global pharmaceutical/biotechnology industry peer group serves as a primary reference group for remuneration
benchmarking, created such that CSL falls in the middle of the group with respect to market capitalisation and
revenue. The group represents global industry peers and is updated annually. The peer group in 2022 included:
AbbVie Inc.; Alexion Pharmaceuticals, Inc.; Allergan plc; Amgen Inc.; AstraZeneca PLC; Bausch Health Companies
Inc.; Bayer Aktiengesellschaft; Biogen Inc.; BioMarin Pharmaceutical Inc.; Bristol-Myers Squibb Company; Eli Lilly
and Company; GlaxoSmithKline plc; Gilead Sciences Inc.; Grifols, S.A.; Merck Kommanditgesellschaft auf Aktien;
Novo Nordisk A/S; Regeneron Pharmaceuticals, Inc.; Takeda Pharmaceutical Company; UCB SA and Vertex
Pharmaceuticals Incorporated. For the 2023 year, Moderna Inc. has been added and Alexion Pharmaceuticals, Inc.
and Allergan plc were removed
In addition, two general industry reference groups representing Australia and North America also help us
appropriately reward senior talent and may be used as a primary, or hybrid, data set for certain Executive KMP
dependent on role and location
Risk
Management
Before determining remuneration outcomes and vesting, we assess alignment with risk management outcomes
to hold executives accountable for effective risk management – both financial and non-financial. In addition,
all variable reward is subject to the Malus and Clawback Policy and the Board has full discretion over the outcome
of any variable reward payment and vesting
The Board has the discretion to apply a ‘Leading and Managing’ modifier to STI and LTI outcomes – formally
recognising the importance of CSL’s culture including leadership behaviours, values, diversity objectives,
sustainability and management of risk. The modifier allows for the Board to adjust in exceptional circumstances
upwards by up to 20% or downwards by up to 50% of annual STI earned, and/or LTI opportunity granted. The
modifier is also available to adjust STI and LTI outcomes for risk management outcomes under our formal risk/
consequence management framework. The Board has a discretion in all circumstances, including a significant
risk management failure, to reduce awards and/or vesting outcomes further, including to zero
Malus and
Clawback
Executive KMP STI and LTI arrangements are subject to malus and clawback provisions that enable the Board
to adjust both vested and unvested awards as appropriate. The circumstances include material misstatement
or omission in financial statements, fraud, dishonesty, adverse risk management outcomes, violation of any
material law or regulation, material violation of CSL’s Code of Conduct or any other policy governing the conduct
of employees or any other serious and wilful misconduct
Shareholding
Requirement
Executive KMP must hold CSL shares equal to 100% of FR (300% for the CEO) within five years from the date
of appointment to their role
Benefits
We also provide market competitive benefits to attract and retain key talent. Benefits may include, but are not
limited to, accident, disability and death insurance, health insurance, car parking, global parental and caregiver
leave, select vaccinations and participation in local benefit programs
The Board retains discretion across all elements of the remuneration framework.
75
CSL Limited Annual Report 2021/22 3.2.2 Remuneration Delivery Timeline
The diagram below illustrates how the components of the 2022 Executive KMP remuneration are delivered over a four year period.
Year 1
Year 2
Year 3
Year 4
FR
STI
LTI
● Award Granted
● Eligible for payment or vesting
3.2.3 Pay Mix
The following diagrams set out the remuneration mix for Executive KMP in 2022. The majority of the target reward mix is variable
reward (STI and LTI) and is at risk. This better aligns Executive KMP rewards with shareholder interests and is aligned to our pay
for performance philosophy, focusing efforts on driving growth and long term performance and sustainability. For his period
of employment in 2022, Professor Cuthbertson was not eligible for variable reward under the executive remuneration framework
due to the nature of his advisory role.
Remuneration Mix – P Perreault (CEO)
Remuneration Mix – A Cuthbertson (Senior Advisor to CEO)
Maximum
14%
32%
54%
Target
16%
19%
65%
Minimum
100%
Maximum
Target
Minimum
100%
100%
100%
40
60
80
100
20
0
● Fixed Reward
● STI
● LTI
20
0
● Fixed Reward
● STI
● LTI
40
60
80
100
Remuneration Mix – J Linton (Chief Financial Officer)
Remuneration Mix – P McKenzie (COO)
Maximum
22%
38%
39%
Maximum
15%
31%
54%
Target
28%
23%
49%
Target
18%
18%
64%
Minimum
100%
Minimum
100%
40
60
80
100
20
0
● Fixed Reward
● STI
● LTI
20
0
● Fixed Reward
● STI
● LTI
40
60
80
100
From a market alignment perspective, within our global pharmaceutical/biotechnology peer group our Executive KMP reward
is generally competitive in the elements of FR and STI. LTI remains below market comparators for all roles, including the CEO,
resulting in Total Target Direct Compensation (FR + target STI + target LTI) below the median (refer to section 8 for detail).
76
Directors’ ReportCSL Limited Annual Report 2021/22 3.2.4 Short Term Incentive (STI)
Rewarding performance over an annual period, the STI program is designed to drive business performance and the creation
of shareholder value. The KPIs on which Executive KMP are assessed and rewarded are challenging and not just duties
expected in the normal course of their role.
In 2022, following a review of the STI program, the Board approved the increase of the maximum payout opportunity from 150%
of target to 200%. This change ensures a more competitive offering, aligning to our global pharmaceutical/biotechnology peers
and also incentivises outperformance, driving a pay for performance culture. Maximum reward will only be earned for truly
outstanding performance. The change also addresses attraction and retention issues in key growth markets, including the U.S.
In the 2022 financial year, sustainability metrics continued to form part of Executive KMP individual KPIs. When the Board
assessed the STI outcomes for Executive KMP they reviewed the sustainability outcomes of the organisation and considered
the application of discretion through the ‘Leading and Managing’ modifier to address any underperformance for the
organisation – the Board deemed no adjustment was required in 2022.
The key features of the STI program for the year ended 30 June 2022 (to be paid in September 2022) are detailed below.
Feature
Description
Performance
Period
Annual award aligned with the financial year – 1 July 2021 to 30 June 2022
Award
Cash
Performance
Measures
Each Executive KMP has a maximum of six KPIs. The KPIs are made up of two financial measures, common to all
participants – Net Profit after Tax (NPAT) and Cash Flow from Operations (CFO), plus up to four individual business
building KPIs. Hurdles are set at threshold, target and maximum levels of performance and there is significant
difference between under achieve/achieve/over achieve targets and measures, so that a challenging but
meaningful incentive is provided for target performance. The performance measures are chosen to ensure
Executive KMP are focused on the achievement of the CSL strategy, delivery of business results and CSL’s success
and sustainability
Financial
Individual
Financial growth is the foundation of long term
sustainability and evidences our competitive
advantage, whilst pursuing profitable growth, and
aligns employee and shareholder objectives. The
financial performance measures are NPAT measured
at constant currency and CFO measured at the
reported rate
Individual performance hurdles align with strategic
priorities, encourage appropriate decision making,
and balance performance in non-financial priorities.
The individual performance measures are based
on individual responsibilities and categories include
divisional performance, achievement of strategic
objectives and improvement in operations, risk
management, compliance, people, health and safety,
ESG and quality
The weighting of the measures for Mr Perreault and Dr McKenzie is NPAT 35%, CFO 25% and Individual 40%.
For Ms Linton, the weighting of measures is NPAT 30%, CFO 30% and Individual 40%
Set as a percentage of FR, target opportunity in 2022 was:
• Mr Perreault – 120%
• Ms Linton – 85%
• Dr McKenzie – 100%
50% earned on threshold level performance, increasing on a straight line basis with 100% earned at target level
performance and 200% on achievement of maximum level performance (capped at 200%). The STI Outcome
percentages are then multiplied by the KPI weighting and individual STI opportunity (as disclosed in Table 3
in section 6.2) to determine the payment amount
Performance
Measure
Weighting
Executive KMP
STI Targets
Vesting
Cessation of
Employment
A ‘qualified leaver’ (for example someone who retires or is made redundant) may receive a pro-rata payment
paid in the ordinary course based on the portion of the Performance Period worked, subject to Performance
Measures being met. If the Executive KMP is not a ‘qualified leaver’, no payment will be made unless the Board
determines otherwise
For the 2023 financial year (2023), a global sustainability measure for which all Executives will be held accountable will be added,
in addition to any relevant individual sustainability KPI measures. The weighting in 2023 will be 5%, reflecting CSL’s sustainability
roadmap as baseline targets are set for future measurement (section 4 provides more detail on this measure for 2023). Each
Executive KMP and Global Leadership Group member will also continue to have sustainability objectives that form part of their
workplans and expected role deliverables, in most cases, not rewarded through STI.
3.2.5 Long Term Incentive (LTI)
In 2022, two changes were made to the LTI plan, reflecting feedback received from investors and to encourage alignment
of executives’ equity interests with shareholders over the longer term.
We introduced a second performance measure of Earnings Per Share growth (EPSg) to complement the current Return
on Invested Capital (ROIC) measure. This change also responded to investor feedback on our single metric. The EPSg
measure is weighted 30% of the LTI and the ROIC measure is weighted 70%.
77
CSL Limited Annual Report 2021/22 We also moved from tranche vesting over a four year period to single point vesting following the end of a three year performance
period. This approach aligns with the most prevalent approach taken by our global pharmaceutical/biotechnology peers and
also responds to investor feedback regarding the previous vesting schedule.
When our target performance is achieved, we want our executives’ LTI to vest – we set targets that require excellent outcomes
for shareholders both absolutely and relative to the performance of our global peers. The LTI plan also rewards and assists us
in retaining our talent. The key features of the program for 2022 LTI awards, granted 1 September 2021, are as follows.
Feature
Description
Summary
A conditional ‘right’ to a CSL share or at the Board’s discretion in exceptional circumstances, a cash equivalent
payment. No price is payable by the Executive KMP on grant or vesting of rights. Shares are allocated (or cash paid)
on vesting without the need for exercise by an Executive KMP
Security
Performance Share Unit (PSU)
Grant
Methodology
To determine the number of PSUs issued, a five day volume weighted average share price is used. The LTI
opportunity for each Executive KMP is divided by the calculated allocation price to determine the number
of securities granted
Performance
Measure
• Tranche 1 – ROIC 70%
• Tranche 2 – EPSg 30%
ROIC Gateway
Performance
Measure
No vesting will occur in Tranche 1 unless an Investment Hurdle Rate (IHR) is achieved in the year of testing. The IHR
is the minimum return CSL requires on its investments to ensure it is making sound investment decisions and
appropriately managing risk and covering its cost base
Performance
Period
Performance
Target
• Tranche 1 ROIC – Seven year average 1 July 2017 to 30 June 2024
• Tranche 2 EPSg – 1 July 2021 to 30 June 2024
• Tranche 1 ROIC – Threshold at 20.0% and Target at 21.4%
• Tranche 2 EPSg – Threshold at 5.0% and Target at 8.3%
Executive KMP
LTI Target
Opportunity1
• Mr Perreault – 400% of FR
• Ms Linton – 175% of FR
• Dr McKenzie – 350% of FR
Vesting
Schedule
50% earned on threshold level performance, increasing on a straight line basis with 100% earned at target level
performance (maximum vesting capped at 100%). The Board has the discretion to adjust vesting outcomes
Vesting Date
1 September 2024
Retesting
No retest of any tranche
Cessation of
Employment
Change of
Control
A ‘qualified leaver’ (for example someone who retires or is made redundant) retains a pro-rated number of PSUs
based on time elapsed since grant date. Retained PSUs will remain subject to original terms and conditions
including satisfaction of performance conditions at the test date. If an Executive KMP is not a ‘qualified leaver’,
all unvested PSUs will lapse unless the Board determines otherwise
In the event of a change of control, the Board, in its absolute discretion, may determine that some or all of the
PSUs vest having regard to the performance of CSL during the performance period to the date of the change
of control event. Vesting may occur at the date of the change of control event or an earlier vesting date as
determined by the Board
Dividends and
Voting Rights
No dividends or dividend equivalents are paid on unvested PSUs. Executive KMP are only eligible for dividends
once shares have been allocated following vesting of any PSUs. PSUs do not carry any voting rights prior to vesting
and allocation of shares
3.2.6 Leading and Managing Modifier
The Board, taking into consideration recommendations from the CEO for Executive KMP, and the Human Resources and
Remuneration Committee (HRRC) for the CEO, has the discretion to apply a ‘Leading and Managing’ modifier to both the
STI and LTI opportunity – allowing for recognition of extraordinary contribution in exceptional circumstances or significant
leadership failure across sustainability, risk management, culture and diversity. Applied to the overall STI outcome or LTI target
opportunity, there can be an increase of up to 20% or a decrease of up to 50% applied. In 2022, the modifier was not applied.
In addition to consideration during the determination of KPI outcomes, the modifier is also utilised for the assessment of the
appropriate management of risk – both financial and non-financial. In consultation with the Audit and Risk Management
Committee (ARMC), the HRRC uses a principles approach to ensure alignment between remuneration outcomes and
performance. This enables management to bring awareness to behaviours that encourage unacceptable levels of risk and
discourage those behaviours, promotes behaviours that encourage acceptable levels of risk and enables the Board to recognise
and appropriately address both acceptable and unacceptable behaviours. In the event of a significant risk management failure,
the Board has the discretion to adjust STI and LTI outcomes downwards, including to zero.
1 Also maximum opportunity.
78
Directors’ ReportCSL Limited Annual Report 2021/22 4. Remuneration Framework Changes in 2023
Sustainability changes – CSL is committed to a healthier world. Our vision is a sustainable future for our employees,
communities, patients and donors, inspired by innovative science and a values-driven culture. In 2021 we adopted a sustainability
strategy that is based on the three pillars of Environment, Social and Sustainable Workforce, and for the focus areas prioritised
under each of the three pillars, in 2022 we have developed a number of actions to validate data sets and baselines.
Ensuring a global shared focus on our long term sustainability and global footprint consistent with our CSL purpose and values,
from 1 July 2022 a CSL Group sustainability metric has been applied to the STI component of variable reward. Weighted at 5%
(noting there will be a reduction in the individual KPI weighting of 5% to include this KPI), all Executives will be held accountable
for objectives shown below that are in support of CSL’s goal of reducing carbon emissions by 2030. Detailed milestones and
outcomes will be disclosed in the 2023 Remuneration Report.
Portfolio
Program Governance
Energy Initiatives
(Scope 1)
Renewable Power
(Scope 2)
New Facilities
(Scope 1 & 2)
Establish a robust program governance process, including reporting, monitoring
and verification that is transparent and aligned with our network strategy. An agile
process that focuses on doing the right thing in the right place at the right time
Undertake global initiatives that reduce CO2 emissions to meet our 40% reduction
target by 2030 and aligned with SBTi; Increase renewable energy supplies at select global
manufacturing sites
Incorporate sustainable design up front in our new facilities that will ensure long term
success as our business grows
Supplier Engagement
(Scope 3)
Engage our supply partners to achieve a low emissions supply chain, working with our
suppliers to follow our lead in their scope 1 & 2 and join us on this journey
The Board will review on an annual basis to determine the appropriate weighting, measure, target and component of variable
reward to align sustainability to (i.e. STI or LTI).
79
CSL Limited Annual Report 2021/22 5. CSL Performance and Shareholder Returns
5.1 Financial Performance from 2016 to 2022
The following graphs2 summarise key financial performance over the past seven financial years. We have disclosed over a seven
year period to align with our ROIC LTI performance measurement period.
Net Profit After Tax/
Earnings Per Share (USD)
Cash Inflow From Operating
Activities (millions USD)
Annual Return on
Invested Capital
2,500
2,000
1,500
1,000
500
0
400
300
200
100
0
600%
4,000
480%
360%
240%
120%
0%
3,500
3,000
2,500
2,000
1,500
1,000
500
0
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
2016
2017
2018
2019
2020
2021
2022
2016
2017
2018
2019
2020
2021
2022
2016
2017
2018
2019
2020
2021
2022
Net Profit After Tax (millions) – USD
Earnings Per Share (cents) – USD
Closing Share Price (at 30 June AUD)/
Total Shareholder Return
Total Dividends
Per Share (cents USD)
60.0%
40.0%
20.0%
0.0%
-20.0%
250
200
150
100
50
0
2016
2017
2018
2019
2020
2021
2022
2016
2017
2018
2019
2020
2021
2022
Closing Share Price (dollars) – AUD
Total Shareholder Return (12 month %) – AUD
2
The 2016 Annual Return on Invested Capital figure includes the gain on acquisition of Novartis’ global influenza vaccine business of US$176.1m. The opening
share price on 1 July 2017 was A$138.03. The Total Shareholder Return outcome at 30 June 2022 was -4.60%. The Total Dividends per Share is the actual total
dividends paid within the financial year.
80
Directors’ ReportCSL Limited Annual Report 2021/22 6. Executive Key Management Personnel Outcomes in 2022
6.1 CSL and Executive KMP Performance
In 2022, CSL has demonstrated resilience in its results, delivering solid performance outcomes. As expected, NPAT was down
from the prior year, reflecting lower plasma collection in 2021. However, the outcome was in line with expectations and at the
top end of market guidance. We continue to progress our research and development pipeline and have grown investment in
this area over the year ensuring innovation for a sustainable business. Revenue increased 3.5% at constant currency. CFO was
also down on prior year due to higher plasma costs and strong plasma collection during 2022. CFO did however exceed target
through strong underlying cash earnings and good working capital management.
The NPAT at 30 June 2022 resulted in performance below target and our CFO achieved an above target performance outcome.
The Board reviewed the quality of earnings, including the impact of COVID-19 across supply and inventory, and risk management
outcomes across the year. As the Vifor Pharma AG (Vifor) acquisition was not contemplated at the time of setting the targets at
the start of the financial year, the Board used its discretion to adjust the outcomes of both NPAT and CFO associated with the
Vifor acquisition net costs. The CFO outcome was also adjusted to remove the impact of the favourable cash inflow resulting from
the Treasury hedging activity associated with the Vifor acquisition. The Leading and Managing Modifier was not used in 2022.
The following performance outcomes were achieved resulting in an average overall STI payment outcome of 125% of target level
opportunity across the Executive KMP (see Table 3). The minimum STI earned as a percentage of target level opportunity was
105% and the maximum was 140% – the latter was 70% of the maximum STI outcome that could be achieved. Additional
objectives, which were also integral to the achievement of individual performance, were considered by the Board when
assessing Executive KMP performance. However, these remain confidential for commercial reasons.
Threshold
50%
Target
100%
Maximum
200%
Table 2: Achievements in 2022
Measure and Commentary
Financials
• NPAT
• CFO
People
• Completion of the organisational transformation across the Enabling Functions
providing a sustainable base and improved scalability
• Transformation of an integrated global R&D business
• Strong progress against the 2022 diversity, inclusion and equity targets furthering
progress to attainment of FY25 and FY30 goals
• Recognised by Forbes magazine as one of America’s best employers
• Recognised as one of Australia and New Zealand’s Best Places to Work by The Australian
Financial Review
• Launch of the CSL Promising Futures scholarship program
Innovation
• Agreement to acquire Vifor – acquisition completed in August 2022
• 24 product registrations or new indications for serious disease across the
CSL Group portfolio
• Garadacimab Phase III study enrolment completed for HAE
• CSL112 (ApoA-1) Phase III study (AEGIS-II) progressing with >80% enrolment achieved
and 3rd interim analysis completed
• Pre-clinical assessment of next generation, self-amplifying mRNA vaccine in season
and pandemic influenza
• FLUCELVAX® Quadrivalent approvals – US and Argentina 6m+ indication, Australia
2y+ extension and New Zealand 9y+ extension
• FLUAD® Quadrivalent Phase III study in adults 50-64y enrolment completed
• EtranaDez (Haem B gene therapy) primary end point achieved in HOPE-B study
with MAA (EU) and BLA (US) submitted
• Completed manufacturing of the AstraZeneca COVID-19 vaccine in Australia
Focus
• Collaboration with StartX as an Innovation Partner to support entrepreneurs
in the StartX community as they commercialise innovative technologies and develop
novel therapeutics
• Collaboration with WEHI and the University of Melbourne to create a biotech start-up
incubator in CSL’s new global headquarters in Melbourne
• Lengnau mechanical completion and transition to Thermo Fisher Scientific management
81
CSL Limited Annual Report 2021/22 Threshold
50%
Target
100%
Maximum
200%
Measure and Commentary
Efficiency and Reliable Supply
• 27 plasma centres opened taking the global total to 330
• US regulatory clearance received for the new plasmapheresis platform with
rollout to be completed by the end of 2023
• Progress against key milestones on our quality system integration initiative
• Record volume of ~135 million doses distributed in our 2022 influenza campaign
• Fill and finish capacity expansion projects at our Liverpool and Holly Springs
sites completed
• Progression of capital expansion projects including the new cell culture influenza
vaccine facility in Australia
• New safety system live across all locations
• Above target delivery against the IG roadmap
Digital Transformation
• Progression of the converged enterprise network strategy across CSL and Seqirus
• Initiation of our next generation Donation Management System initiative
• Enhanced CSL Plasma Donor app with new functionality
• Significantly enhanced partnership with Capgemini
• Milestones achieved in our digital transformation to build capabilities in digital
experiences, and insights and analytics
6.2 STI Outcomes by Executive KMP in 2022
The financial performance of CSL (NPAT and CFO) makes up the majority weighting of the KPIs for Executive KMP – 60%,
incentivising the delivery of strong financial performance.
Achievements that contributed to the outcomes detailed in Table 3 below can be found in Table 2 of this Report. The Board
made no adjustments under the Malus and Clawback Policy and no risk management, behaviour or compliance issues
involving Executive KMP were identified during the joint consultation between the HRRC and ARMC.
Table 3: STI Outcomes in 2022
Value of STI
Earned US$
Target STI
Opportunity
as a % of FR
Maximum
STI
Opportunity
as a % of FR
STI Earned
as % of
Target
Opportunity
STI Earned
as % of
Maximum
Opportunity3
STI Earned
as % of FR
Financial
Performance
Outcome
Individual
Performance
Outcome
Executive
P Perreault
3,029,931
120%
240%
140%
70%
168%
J Linton
1,149,742
85%
170%
105%
72%
122%
P McKenzie
1,273,770
100%
200%
130%
65%
130%
Between
Target and
Maximum
Between
Target and
Maximum
Between
Target and
Maximum
Between
Target and
Maximum
Between
Threshold
and Target
Between
Threshold
and Target
3 Any STI that was not earned was automatically forfeited.
82
Directors’ ReportCSL Limited Annual Report 2021/22 6.2.1 CEO 2022 STI Achievement and Outcome
The Board considered the following highlights when determining the STI outcome for Mr Perreault.
Table 4: CEO STI Outcomes in 2022
Weight
Threshold
50%
Target
100%
Maximum
200%
US$2,125m US$2,361m US$2,597m
35%
25%
20%
US$2,028m US$2,253m US$2,591m
% of
Maximum
Opportunity
47.5%
96.5%
65.0%
Measure and Commentary
Financials
• Solid adjusted NPAT result against target
• Strong adjusted CFO outcome exceeding target
Stabilise plasma business fundamentals and return
to sustainable growth
• Plasma collection improvement on 2021
• US regulatory clearance received for the new plasmapheresis
platform and progression of the partnership with Terumo –
delay of implementation due to supply chain constraints
• Transformation of an integrated global R&D function across
CSL and Seqirus
• Execution of merger and acquisition deals with significant
achievement on the Vifor acquisition
Deliver growth and efficiency initiatives and build a robust
pipeline of safe and effective life-saving medicines
10%
87.5%
• Above target outcomes on IG roadmap
• Improvement in all safety metrics over prior year –
TRIFR improvement across most functions/sites
• Readiness for new product launches across the end
to end supply chain and commercial operations
• Significant progress on the sustainability strategy
and roadmap
• Lengnau mechanical completion and transition
to Thermo Fisher Scientific management
People and Culture
10%
75.0%
• Key succession plan milestones advanced
• Diversity, Equity and Inclusion objectives delivered ensuring
trending toward achievement of longer term goals
83
CSL Limited Annual Report 2021/22 6.3 LTI Outcomes by Executive KMP in 2022
6.3.1 LTI Awards Tested in 2022
In 2022, in the course of annual performance testing, five LTI grants were tested. The table below shows the performance
of CSL against the targets with vesting occurring in September 2021 and March 2022.
Table 5: LTI Awards Tested in 2022
Grant Date
Security
Tranche
Performance Period
Exercise
Price A$
1 October 2017
1 September 2018
1 September 2019
1 September 2020
1 April 2021
1 April 2021
PSU
PSU
PSU
PSU
PSU
RSU
4
3
2
1
1
1
1 July 2014 – 30 June 2021
1 July 2014 – 30 June 2021
1 July 2014 – 30 June 2021
1 July 2014 – 30 June 2021
1 July 2014 – 30 June 2021
1 April 2021 – 1 March 2022
–
–
–
–
–
–
Performance Outcome
Seven year ROIC at 25.1%
Seven year ROIC at 25.1%
Seven year ROIC at 25.1%
Seven year ROIC at 25.1%
Seven year ROIC at 25.1%
Individual performance
Vesting
Outcome
68.33%4
68.33%5
100%
100%
100%
100%
6.3.2 Fair Value of Awards Granted, Vested and Lapsed Equity in 2022
The table below details the fair value at the date of grant for all awards granted6, vested and lapsed in 2022. The values are
shown in Australian Dollars (A$).
Table 6: Grant Fair Value
Security
Tranche
Grant Date
Vest/Lapse Date
Expiry Date
Fair Value at Grant A$
PSU
PSU
PSU
PSU
PSU
PSU
PSU
PSU
PSU
PSU
Restricted Share Unit (RSU)
RSU
4
3
4
2
3
4
1
1
1
2
1
2
1 Oct 2017
1 Sep 2018
1 Sep 2018
1 Sep 2019
1 Sep 2019
1 Sep 2019
1 Sep 2020
1 Apr 2021
1 Sep 2021
1 Sep 2021
1 Apr 2021
1 Apr 2021
1 Sep 2021
1 Sep 2021
1 Oct 2021
1 Sep 2021
1 Oct 2021
1 Oct 2021
1 Sep 2021
1 Sep 2021
1 Sep 2024
1 Sep 2024
1 Sep 2021
1 Mar 2022
1 Oct 2024
1 Oct 2024
1 Oct 2024
1 Oct 2029
1 Oct 2029
1 Oct 2029
1 Sep 2025
1 Apr 2026
1 Sep 2026
1 Sep 2026
1 Apr 2026
1 Apr 2026
124.60
219.41
216.13
230.50
228.14
225.80
287.79
265.48
302.44
302.44
265.48
264.08
6.3.3 Summary of Executive KMP Granted, Vested and Lapsed Equity in 2022
The table below summarises the details of equity awards granted, vested and lapsed in US Dollars (US$) for each Executive KMP.
For awards granted, the maximum number of securities that may vest is shown. For accounting purposes, the maximum value
of each grant is the fair value of the equity granted multiplied by the number of equity instruments granted, or remaining each
year. Ultimately, the maximum value of the equity awards will be equal to the number of securities granted multiplied by the
CSL share price at the time of vesting. The minimum number of securities and the value of the equity awards is zero if the equity
award is fully lapsed. Details of the performance and service criteria applying to awards granted in prior years are summarised
in section 11 and prior Remuneration Reports corresponding to the reporting period in which the awards were granted.
The April 2021 grants were awarded to Ms Linton as a commencement benefit, providing a more competitive reward offering
and compensating for a pro-rata portion of the loss of cash settled LTI awards held by Ms Linton at her cessation of employment
with Bupa. Further detail is disclosed in the 2021 Remuneration Report.
4 The remaining 31.67% of this tranche has lapsed – there is no retest.
5 The remaining 31.67% of this tranche has lapsed – there is no retest.
6
The grant date of PSUs granted to P Perreault was 13 October 2021. Shareholder approval for the grant of PSUs and any shares to be issued at the time
of vesting, was obtained under ASX Listing Rule 10.14 at the 2021 Annual General Meeting.
84
Directors’ ReportCSL Limited Annual Report 2021/22 Table 7: Movement in Equity in 2022
A Cuthbertson PSU
4 1 Oct 2017
1 Sep 2021
Tran-
che Grant Date Vesting Date
Exer-
cise
Price
A$
Fair
Value at
Grant
US$
Face
Value at
Grant
US$7 Granted Vested Lapsed
Face
Value at
Vest
– Vested
Award
US$8
Face
Value at
Lapse
– Lapsed
Award
US$9
4 1 Oct 2017
1 Sep 2021
–
1,180,425
1,269,098
13,013
8,892
4,121 2,000,844 927,292
3 1 Sep 2018
1 Sep 2021
– 1,495,436 1,549,280
9,362
6,398
2,964 1,439,654 666,948
2 1 Sep 2019
1 Sep 2021
1,832,164
1,942,441
11,077
11,077
– 2,492,504
1
1
1 Sep 2020
1 Sep 2021
1,715,523
1,679,101
8,188
8,188
1 Sep 2021
1 Sep 2024
– 4,876,594 4,983,659
22,148
2 1 Sep 2021
1 Sep 2024
– 2,089,969
2,135,853
9,492
–
–
1,842,433
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
3 1 Sep 2018
1 Sep 2021
4 1 Sep 2018
1 Sep 2021
2 1 Sep 2019
1 Sep 2021
3 1 Sep 2019
1 Sep 2021
4 1 Sep 2019
1 Sep 2021
1
1
1 Apr 2021
1 Sep 2021
1 Sep 2021
1 Sep 2024
1
2
1 Apr 2021
1 Sep 2021
1 Apr 2021
1 Mar 2022
2 1 Sep 2019
1 Sep 2021
2
2
1
1
2
1 Sep 2019
1 Sep 2021
1 Sep 2019
1 Sep 2021
1 Sep 2020
1 Sep 2021
1 Sep 2021
1 Sep 2024
1 Sep 2021
1 Sep 2024
–
–
–
–
–
–
–
–
191,310
205,681
2,109
1,442
357,326
370,192
2,237
1,529
351,828
370,027
2,236
354,458
375,792
355,932
375,792
352,117
375,617
2,143
2,143
2,142
–
2,143
–
–
632,974
627,061
3,275
3,275
1,121,388
1,146,007
5,093
2,183
–
–
414,767
410,893
2,146
2,146
1,155,070
1,150,346
6,008
6,008
–
–
–
667
708
465
324,473
150,086
344,050
159,312
–
97,791
–
482,209
–
595
981
–
–
–
–
–
–
125,130
– 206,307
736,928
–
–
482,885
1,142,036
–
–
–
–
–
1,210,906
1,265,383
7,216
4,931
2,285
1,109,555
514,162
761,348
807,173
4,603
4,603
316,746
335,811
1,915
1,915
817,115
799,767
3,900
3,900
2,329,967
2,381,122
10,582
998,526
1,020,449
4,535
–
–
–
–
–
–
–
1,035,749
430,906
877,563
–
–
–
–
–
–
–
2 1 Sep 2021
1 Sep 2024
– 480,658
491,211
Executive
P Perreault
Sec-
urity
PSU
PSU
PSU
PSU
PSU
PSU
J Linton
P McKenzie
PSU
PSU
PSU
PSU
PSU
PSU
PSU
PSU
RSU
RSU
PSU
PSU
PSU
PSU
PSU
PSU
6.3.4 Executive KMP 2023 Equity Vesting Opportunity
Four awards will be tested in 2023. The following tables set out a preview of these awards with Table 9 providing the specific
grant details for each Executive KMP. The face value in Table 8 is provided in A$.
Table 8: LTI Awards to be Tested in 2023
Grant Date
Security
Performance Measure
Exercise Price
A$
Face Value of a
CSL Share at
Date of Grant A$
1 September 2018
1 September 2019
1 September 2020
1 April 2021
PSU
PSU
PSU
RSU
ROIC
ROIC
ROIC
Individual Performance
–
–
–
–
Table 9: Executive KMP LTI Opportunity to be Tested in 2023
Executive
P Perreault
J Linton
P McKenzie
227.31
240.87
281.68
263.00
Number of
Performance
Share Units
Number of
Restricted
Share Units
28,628
–
15,069
–
5,097
–
7
8
9
Securities granted multiplied by the closing CSL share price on the date of grant. The A$ value was converted to US$ at an average exchange rate for the 2022
financial year of 1.37359.
Securities vested multiplied by the closing CSL share price on the date of vest. All awards were automatically exercised on vesting. The A$ value was converted
to US$ at an average exchange rate for the 2022 financial year of 1.37359.
Securities lapsed multiplied by the closing CSL share price on the date of lapse. The A$ value was converted to US$ at an average exchange rate for the 2022
financial year of 1.37359.
85
CSL Limited Annual Report 2021/22 7. Executive Key Management Personnel Statutory Remuneration Tables
Remuneration is reported in US$, unless otherwise stated. This is consistent with the presentation currency used by CSL.
7.1 Executive KMP Remuneration 2021 and 2022
Table 10: Statutory Remuneration Disclosure – Executive KMP
Short Term Benefits
Post Employment
Other Long
Term
Executive
P Perreault –
CEO and Managing Director
J Linton –
Chief Financial Officer15
P McKenzie –
Chief Operating Officer
Former Executive KMP
A Cuthbertson –
Senior Advisor to CEO16
TOTAL
Year11
Cash Salary
and Fees12
Cash Bonus
US$13
Cash Sign
On US$
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
1,733,962
3,029,931
1,697,123
1,807,032
874,803
1,149,742
–
–
–
281,781
288,464
78,220
965,230
1,273,770
989,079
1,028,970
128,811
–
505,666
483,067
3,702,806
5,453,443
–
–
–
–
–
3,473,649
3,607,533
78,220
Non-
Monetary
US$14
92,441
95,083
81,479
122,927
67,972
70,140
–
32,648
241,892
320,798
Super US$
18,300
20,300
25,689
6,786
16,802
22,123
4,550
18,579
65,341
67,788
Long Service
Performance
Leave US$
Rights US$
US$
Total US$
Related
% Performance
Share Based Payments10
Restricted
Share Units
(66,026)
6,570,910
Performance
Share Units
US$
4,987,494
699,401
384,315
2,577,351
3,684,975
–
–
–
–
–
–
–
1,540,207
4,392,904
708,425
–
–
–
–
–
–
9,862,128
10,124,423
1,877,757
4,901,125
5,795,287
38,597
1,760,117
81%
82%
77%
74%
79%
81%
(253)%
68%
79%
80%
(14,490)
(97,619)
723,043
8,166,627
1,540,207
19,194,754
(80,516)
11,363,243
708,425
19,557,584
21,583
6,840
–
–
–
–
2,855
11,603
24,438
18,443
10 The Performance Rights have been valued using a combination of the Binomial and Black Scholes option valuation methodologies including Monte Carlo
simulation as at the grant date adjusted for the probability of hurdles being achieved. The Performance Share Units and Restricted Share Units have been
valued using the Black Scholes option valuation methodology. These valuations were undertaken by Deloitte and PricewaterhouseCoopers. The amounts
disclosed have been determined by allocating the value of the Performance Rights, Performance Share Units and Restricted Share Units over the period from
grant date to vesting date in accordance with applicable accounting standards. Share based payments have been converted to US$ at an average exchange
rate for the 2022 financial year: A$ – 1.37359. There were no Options expensed or outstanding in 2021 or 2022.
The A$ compensation paid during the years ended 30 June 2021 and 30 June 2022 have been converted to US$. For the 30 June 2022 compensation, this
has been converted to US$ at an average exchange rate for the 2022 financial year: A$ – 1.37359. For the 2021 compensation, this has been converted to US$
at an average exchange rate for the 2021 financial year: A$ – 1.34557. Both the amount of remuneration and any movement in comparison to prior years may
be influenced by changes in the exchange rates. No termination benefits were paid in 2022.
11
12 Includes cash salary, cash allowances and short term compensated absences, such as annual leave entitlements accrued but not taken during the year.
13 The cash bonus in respect of 2022 is scheduled to be paid in September 2022. The cash component of the cash bonus received in 2021 was paid in full in
September 2021 for all Executive KMP as previously disclosed, with no adjustment.
14 Includes any health benefits, insurances benefits and other benefits. For International Assignees and domestic and international relocations, this may include
personal tax advice, health insurance, removalists, temporary accommodation and other expatriate assignment benefits.
15 In 2021 J Linton was an Executive KMP for the period 5 March 2021 to 30 June 2021.
16 In 2022 A Cuthbertson was an Executive KMP for the period 1 July 2021 to 1 October 2021.
86
Directors’ ReportCSL Limited Annual Report 2021/22 Table 10: Statutory Remuneration Disclosure – Executive KMP
Executive
P Perreault –
CEO and Managing Director
J Linton –
Chief Financial Officer15
P McKenzie –
Chief Operating Officer
Former Executive KMP
A Cuthbertson –
Senior Advisor to CEO16
TOTAL
Short Term Benefits
Post Employment
Cash Salary
Cash Bonus
Cash Sign
Monetary
Year11
and Fees12
US$13
On US$
Super US$
281,781
288,464
78,220
1,733,962
3,029,931
1,697,123
1,807,032
874,803
1,149,742
965,230
1,273,770
989,079
1,028,970
128,811
–
505,666
483,067
3,702,806
5,453,443
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
3,473,649
3,607,533
78,220
Non-
US$14
92,441
95,083
81,479
122,927
67,972
70,140
–
32,648
241,892
320,798
–
–
–
–
–
–
–
–
18,300
20,300
25,689
6,786
16,802
22,123
4,550
18,579
65,341
67,788
Other Long
Term
Share Based Payments10
Long Service
Leave US$
Performance
Rights US$
Performance
Share Units
US$
Restricted
Share Units
US$
–
–
21,583
6,840
–
–
2,855
11,603
24,438
18,443
Total US$
9,862,128
10,124,423
–
4,987,494
(66,026)
6,570,910
–
–
–
–
–
–
–
(14,490)
699,401
384,315
2,577,351
3,684,975
(97,619)
723,043
1,540,207
4,392,904
708,425
–
–
–
–
1,877,757
4,901,125
5,795,287
38,597
1,760,117
–
8,166,627
1,540,207
19,194,754
(80,516)
11,363,243
708,425
19,557,584
% Performance
Related
81%
82%
77%
74%
79%
81%
(253)%
68%
79%
80%
87
CSL Limited Annual Report 2021/22 7.2 Executive KMP Shareholdings
Details of shares held directly, indirectly or beneficially by each Executive KMP, including their related parties, are provided in
Table 11. Details of Options, Performance Rights, Performance Share Units and Restricted Share Units held directly, indirectly or
beneficially by each Executive KMP, including their related parties, are provided in Table 12. Any amounts are presented in US$.
Following the vesting of awards, any trading undertaken by Executive KMP was subject to the Group Securities Dealing Policy
(outlined in section 10.6). Approved trading disclosed was actioned in accordance with the Policy, including forced trades to
cover CSL tax withholding obligations.
Table 11: Executive KMP Shareholdings
Executive
P Perreault
J Linton
P McKenzie
Former Executive KMP
Balance at
1 July 2021
163,241
–
10,651
Number of Shares
Acquired on Exercise of
Options, Performance
Rights, PSUs or RSUs
during year US$
Value of Shares Acquired
on Exercise of Options,
Performance Rights, PSUs
or RSUs during year US$17
Number of
(Shares Sold)/
Purchased
Balance at
30 June 2022
34,555
11,429
15,349
7,775,435
2,361,849
3,453,773
(31,495)
118
(5,326)
166,301
11,547
20,674
A Cuthbertson18
106,579
5,114
1,150,732
–
111,693
There have been no movements in shareholdings of Executive KMP between 30 June 2022 and the date of this Report.
Table 12: Executive KMP Option, Performance Right, Performance Share Unit and Restricted Share Unit Holding
Balance
as at
1 July 2021
Security
Number
Granted
Number
Exercised
Number
Lapsed
Balance
as at 30
June 2022
Number
Vested
During
Year
PSU
PSU
RSU
PSU
13,647
45,107
97,719
31,640
34,555
7,085
87,719
34,555
3,275
7,276
3,275
8,154
–
–
7,276
5,493
3,275
8,154
–
15,117
15,349
2,285
42,590
15,349
Executive
P Perreault
J Linton
P McKenzie
Former Executive KMP
A Cuthbertson20
PSU
13,010
–
5,114
3,416
4,480
5,114
Balance as at 30 June 2022
Vested19
Unvested
–
–
–
–
–
87,719
7,276
5,493
42,590
4,480
17 The value of Performance Share Units and Restricted Share Units at the exercise date has been determined by the share price at the close of business on the
exercise date multiplied by the number of securities exercised during 2022. The A$ value was converted to US$ at an average exchange rate for the year of 1.37359.
18 The closing balance for A Cuthbertson is at 1 October 2021 being the date A Cuthbertson ceased to be Executive KMP.
19 Vested awards are exercisable to the Executive KMP. There are no vested and unexercisable awards.
20 The closing balance for A Cuthbertson is at 1 October 2021 being the date A Cuthbertson ceased to be Executive KMP.
88
Directors’ ReportCSL Limited Annual Report 2021/22 8. 2022 and 2023 Executive Key Management Personnel Remuneration
8.1 CEO Target Remuneration
8.2 2022 Executive KMP Realised Remuneration
8.2.1 2022 CEO Realised Remuneration
Below we have disclosed the CEO ‘realised’ remuneration.
This is a voluntary disclosure which the Board believes is
simple and affords a transparent view of what the CEO’s
actual take-home pay was in 2022. These outcomes are
aligned with the CEO’s and CSL’s performance during 2022,
as well as being aligned to CSL’s longer term performance.
This information has not been prepared in accordance with
the Australian accounting standards. See section 7.1 Table 10 for
the Statutory Remuneration disclosure that has been prepared
in accordance with the Australian accounting standards.
2022 CEO Realised Remuneration – USD
1,905,517
3,029,931
7,775,435
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
● 2022 Fixed Reward
● 2022 STI Received
● 2022 LTI Received
Mr Perreault’s total ‘realised’ remuneration for 2022 was
US$12,710,883 and this is a 72% decrease from the prior year.
The decrease was as a result of legacy Option and Performance
Right LTI plans ceasing in 2021. All LTI awards that vested in
2022 were granted under the framework introduced in 2017.
The Board determines any increases to reward for the CEO
based on his performance and relative to external benchmarks.
When comparing Mr Perreault’s total reward to the reward
of CEOs across the pharmaceutical/biotechnology peer
group, Mr Perreault lags the median – specifically on the
LTI component, currently sitting at 81% of the Total Target
Direct Compensation median.
8.1.1 2022 CEO Target Remuneration
In 2022, the Board determined that Mr Perreault would
receive a 3% increase to FR, taking this to US$1,803,530.
Mr Perreault’s STI percentage remained set at 120% of his FR
for target performance and his maximum payout opportunity
capped at 240% of his FR for outstanding performance.
This maximum opportunity was increased from 180% in the
prior year due to the framework change where the Board
increased the maximum STI opportunity to 200% of target
from 150%. There was no increase applied to his LTI target,
remaining at 400% of FR (also maximum opportunity).
However, given FR has increased the monetary value of the
maximum opportunity has increased.
8.1.2 2023 CEO Target Remuneration
In 2023, the Board has determined that Mr Perreault
will receive a 3.5% increase to FR – US$1,866,654 effective
1 September 2022. There will be no change to Mr Perreault’s
STI target, remaining at 120% with a maximum opportunity
of 240%. An increase in the LTI target from 400% of FR to
450% of FR has been applied – this is also the maximum
opportunity. These changes increase Mr Perreault’s
Total Target Direct Compensation from US$11,181,886
to US$12,506,582.
Mr Perreault’s target reward for 2023 is displayed below,
along with the 2023 comparison to CEOs in our
pharmaceutical/biotechnology peer group.
2023 CEO Target Remuneration
and Peer Group Comparison – US$
15,420,773
12,506,582
12,111,053
8,399,943
2023 Total Target
Direct Compensation
2023 LTI Target
2023 STI Target
2023 Fixed Reward
2,332,238
2,239,985
1,723,546
1,866,654
● Peer Group CEO – median
● P Perreault
89
CSL Limited Annual Report 2021/22
8.2.2 2022 Executive KMP Realised Remuneration
Table 13 shows the ‘realised’ remuneration of Executive KMP for the year ended 30 June 2022 in US$, providing a simple and
transparent view of what Executive KMP actual take home pay was in 2022.
Table 13: Executive KMP ‘Realised’ Remuneration (Received or Available as Cash) in 2022
2022 Total Fixed
Reward US$21
2022 STI US$22
LTI Vested in
2022 US$23
Total Reward
Received US$
Total LTI Reward
Received
(valued at grant
date) US$24
LTI Growth in
Value (due to
share price
growth) US$25
2022
1,905,517
961,840
1,061,344
2022
2018 – 2022
2018 – 2022
2018 – 2022
2018 – 2022
3,029,931
1,149,742
1,273,770
7,775,435
2,361,849
3,453,773
12,710,883
4,473,431
5,788,887
5,547,518
2,188,300
2,807,441
2,227,917
173,549
646,332
Executive
Period Earned
P Perreault
J Linton
P McKenzie
8.3 2022 and 2023 Executive KMP Remuneration Adjustments
CSL competes for talent in a global market and we need to attract and retain high calibre executives in a highly competitive global
pharmaceutical and biotechnology industry. The unique skill set with specialised pharmaceutical and biotechnology expertise and
experience that we require is critical to enable us to deliver on our strategy, promise to patients and deliver returns to our shareholders.
Table 14 sets out the changes to Executive KMP reward for 2022 (effective 1 September 2021) and 2023 (effective 1 September 2022).
As noted earlier in this Report, a global pharmaceutical/biotechnology peer group is used for external benchmarking26. We align
reward with the median of this peer group. The below rewards position our Executive KMP more competitively in the market, at
or below the median for total reward. The increases also take into consideration the skills and experience of Executive KMP. For
Ms Linton, the annual salary review increase is 3.25% and the remaining 0.45% is the superannuation guarantee increase that was
effective 1 July 2022. In determining reward, the Board considers internal pay relativity across the full Global Leadership Group.
Table 14: Adjustments to Executive KMP Reward 2022 and 2023
Executive
P Perreault
J Linton
P McKenzie
Year
2023
2022
2023
2022
2023
2022
% change in FR
% Change in STI
$ Opportunity
at Target
% Change in LTI
$ Opportunity
at Target
Total Reward
Adjustment %
Total Reward
Adjustment US$
3.50%
3.00%
3.70%
3.40%
3.50%
3.00%
3.50%
3.00%
22.29%
3.40%
3.50%
3.00%
16.44%
3.00%
33.65%
3.40%
25.68%
3.00%
11.85%
3.00%
22.72%
3.40%
17.61%
3.00%
1,324,696
325,686
769,592
113,706
950,669
157,207
8.4 2023 Executive KMP Target Remuneration and Peer Group Comparison
The target reward for both Ms Linton and Dr McKenzie for 2023 are displayed below, along with the 2023 comparison to their respective
peers in our pharmaceutical/biotechnology peer group. The peer group comparison for Mr Perreault is detailed in section 8.1.2 above.
2023 J Linton Target Remuneration
and Peer Group Comparison – US$
2023 P McKenzie Target Remuneration
and Peer Group Comparison – US$
2023 Total Target
Direct Compensation
2023 LTI Target
2023 STI Target
2023 Fixed Reward
922,192
978,133
929,297
978,133
4,157,066
3,836,683
2,200,800
5,771,830
2023 Total Target
Direct Compensation
2023 LTI Target
2023 STI Target
2023 Fixed Reward
805,977
1,015,680
974,197
1,015,680
7,902,075
6,348,000
5,792,345
4,316,640
● Peer Group CEO – median
● J Linton
● Peer Group CEO – median
● P McKenzie
21 Includes base salary, retirement/superannuation benefits, and other benefits such as insurances, relocation and allowances paid in 2022.
22 Relates to STI earned in 2022 and will be paid in September 2022 (refer to section 6.2).
23 Value of LTI vested at 1 September 2021 and 1 March 2022 that became unrestricted (refer to section 6.4). The value at vest has been determined by multiplying
the number of vested units by the closing share price on the date of vest. This has been converted to US$ at an average exchange rate for the 2022 financial year
of 1.37359. The awards for J Linton were commencement benefits earned in 2021 given Ms Linton commenced employment with CSL in 2021.
24 The value at grant has been determined by multiplying the number of vested units by the closing share price on the date of grant. This has been converted to
US$ at an average exchange rate for the 2022 financial year of 1.37359.
25 This figure shows the increase in market value of the LTI awards due to share price growth between the grant date and the vesting date. The increase in value of
the awards is calculated by multiplying the number of vested and/or exercised awards by the difference between the share price of CSL shares on the grant date
and the vesting date or exercise date (as applicable). This has been converted to US$ at an average exchange rate for the 2022 financial year of 1.37359.
26 Two general industry reference groups, being Australia and North America, are also used for benchmarking of certain Executive KMP roles.
90
Directors’ ReportCSL Limited Annual Report 2021/22 9. Non-Executive Director Remuneration
9.1 NED Fee Policy
Feature
Description
Strategic Objective
Maximum Aggregate Fees
Approved by Shareholders
Remuneration Reviews
Independence
NED Equity
CSL’s NED fee arrangements are designed to appropriately compensate suitably qualified directors,
with appropriate experience and expertise, for their Board responsibilities and contribution to Board
committees. In the 2022 year, the Board had four Committees for which fees were payable
The current maximum aggregate fee pool of A$4,000,000 was approved by shareholders on
12 October 2016 and has applied from this date. Actual NED fees paid during the 2022 year (including
superannuation contributions, NED Rights Plan sacrifice amounts and Committee fees) are within this
agreed limit, and totalled A$2,944,126. NEDs may be reimbursed for reasonable expenses incurred by
them in the course of discharging their duties and this reimbursement is not included within this limit
The Board in conjunction with the HRRC, reviews NED fees on an annual basis in line with general
industry practice. Fees are set with reference to the responsibilities and time commitments expected
of NEDs along with consideration to the level of fees paid to NEDs of comparable Australian companies
To ensure independence and impartiality is maintained, NEDs do not receive any performance
related remuneration
The NEDs participate in the NED Rights Plan – introduced to enable NEDs to build up meaningful
levels of equity more quickly. Under the plan, NEDs sacrifice at least 20% of their pre-tax base fee in
return for a grant of Rights, each Right entitling a NED to acquire one CSL share at no additional cost.
The number of Rights granted is equivalent to the fee sacrificed divided by the prevailing market price
of CSL shares at that time. Rights are allocated in two tranches and vesting occurs following the
disclosure of half year and full year financial results following the grant of Rights. For Australian based
NEDs, shares are allocated at vesting of the Rights and are then subject to a nominated restriction
period of three to fifteen years. For overseas based NEDs, shares are allocated at the end of the
nominated three to fifteen year restriction period. At the end of the nominated restriction period the
NED is able to access their shares. No price is payable on vesting and exercise of rights. Shares are
automatically allocated without the need for exercise by a NED. As this is a salary sacrifice plan, no
performance conditions apply to the Rights. The shares are purchased on-market. Additional shares
may be purchased by NEDs on-market at prevailing share prices in accordance with CSL’s Securities
Dealing Policy
Shareholding Requirement NEDs must hold CSL shares equal to 100% of their Board base fee within five years from the date
of appointment to their role
Post-Employment Benefits
Superannuation contributions are made in accordance with legislation and are included in the
reported base fee and are not additional to the base fee. NEDs are not entitled to any compensation
on cessation of appointment
Contracts
NEDs are appointed under a letter of appointment and are subject to ordinary election and rotation
requirements as stipulated in the ASX Listing Rules and CSL Limited’s constitution
9.2 NED Fees in 2022
The following table provides details of current Board and Committee fees from 1 July 2021. As a truly global business, our NED
fee structure allows us to attract and recruit appropriately skilled directors.
In 2022, after reviewing both ASX12 and ASX25 comparative Board fees, the Board determined to increase Board and
Committee fees by 3% from 1 July 2022. This increase is within the maximum aggregate remuneration that may be paid to all
NEDs, as agreed by shareholders at the 2016 AGM, meaning that further shareholder approval to increase these fees was not
required. These increases ensure market competitive fees and allow us to attract and retain high quality NEDs.
Table 15: NED Fees 2022 and 2023
Board Chairman Fee
Board NED Base Fee
2022 Fees
A$870,000
A$245,250
2023 Fees
A$896,100
A$252,600
Committee Fees
Committee Chair
Committee Member
Committee Chair
Committee Member
Audit & Risk Management
Corporate Governance
& Nomination
Human Resources
& Remuneration
Innovation & Development
A$70,000
A$30,100
A$60,000
A$58,150
A$34,250
A$15,100
A$30,100
A$30,100
A$72,100
A$31,000
A$61,800
A$59,900
A$35,300
A$15,550
A$31,000
A$31,000
A travel allowance of A$15,000 per annum is in place for those NEDs who reside outside of Australia and travel to and from
Australia to attend Board and Committee meetings. Where no travel is undertaken in a quarter, no allowance is paid. In 2022,
no allowance was paid.
91
CSL Limited Annual Report 2021/22 9.3 Non-Executive Share Purchases
During 2022, CSL completed two on-market purchases of shares for the purposes of the NED Rights Plan. A total of 1,957 shares
were purchased during the reporting period and the average price paid per share was A$286.66.
9.4 Non-Executive Director Statutory Remuneration Tables
Remuneration is reported in US$, unless otherwise stated. This is consistent with the presentation currency used by CSL.
9.4.1 Non-Executive Director Remuneration 2021 and 2022
Table 16: Statutory Remuneration Disclosure – Non-Executive Directors
Non-Executive Director
B McNamee – Chairman
B Brook
M Clark
A Cuthbertson29
C Hewson
D Maskell30
M McDonald
A Watkins31
Former Non-Executive Director
A Hussain32
C O’Reilly33
P Soriot34
TOTAL
Short Term
Benefits
Post Employment
Share Based
Payments
Cash Salary
and Fees US$27
Superannuation
US$
Retirement
Benefits US$
Rights US$28
Total
489,543
471,611
178,358
186,907
202,267
200,432
117,973
–
140,877
140,471
60,806
–
171,831
166,922
121,065
–
–
185,291
–
45,206
–
76,875
1,482,720
1,473,715
17,158
16,123
8,579
16,123
17,158
16,123
15,015
–
17,158
16,123
20,021
–
–
4,031
20,021
–
–
87
–
–
–
103
115,110
68,713
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
125,313
120,767
51,686
37,492
35,290
34,982
33,844
–
88,508
109,237
85,480
–
52,966
52,574
49,819
–
–
632,014
608,501
238,623
240,522
254,715
251,537
166,832
–
246,543
265,831
166,307
–
224,797
223,527
190,905
–
–
37,532
222,910
–
–
29,286
74,492
–
–
13,312
90,290
522,906
2,120,736
435,182
1,977,610
Year
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
9.4.2 Non-Executive Director Shareholdings
Details of shares held directly, indirectly or beneficially by each NED, including their related parties, is provided in Table 17.
Any amounts are presented in US$. Details of Rights held directly, indirectly or beneficially by each NED, including their
related parties, is provided in Table 18. Following the vesting of awards, any trading undertaken by NEDs was subject to the
Group Securities Dealing Policy (outlined in section 10.6).
27 The A$ compensation paid and share based payments during the years ended 30 June 2021 and 30 June 2022 have been converted to US$. For the 2022
compensation, this has been converted to US$ at an average exchange rate for the 2022 financial year: A$ – 1.37359. For the 2021 compensation, this has been
converted to US$ at an average exchange rate for the 2021 financial year: A$ – 1.34557. Both the amount of remuneration and any movement in comparison
to prior years may be influenced by changes in the A$/US$ exchange rates. No long term or termination benefits were paid in 2022.
28 As disclosed in the section 9.1, NEDs participate in the NED Rights Plan under which NEDs are required to take at least 20% of their after-tax base fees (excluding
superannuation guarantee contributions) in the form of Rights. Rights are granted upfront and are expensed over the period of grant to vest. The Fair Value per
Right at the grant date of 26 August 2021 was A$304.00 for Tranche 1 (vests 21 February 2022) and A$302.62 for Tranche 2 (vests 22 August 2022). For the award
made to A Cuthbertson on 4 October 2021, the Fair Value for Tranche 1 was A$292.17 and for Tranche 2 was A$290.69.
29 In 2022 A Cuthbertson was a NED for the period 2 October 2021 to 30 June 2022.
30 In 2022 D Maskell was a NED for the period 18 August 2021 to 30 June 2022.
31 In 2022 A Watkins was a NED for the period 18 August 2021 to 30 June 2022.
32 In 2021 A Hussain was a NED for the period 1 July 2020 to 25 June 2021.
33 In 2021 C O’Reilly was a NED for the period 1 July 2020 to 14 October 2020.
34 In 2021 P Soriot was a NED for the period 19 August 2020 to 31 January 2021.
92
Directors’ ReportCSL Limited Annual Report 2021/22 Table 17: Non-Executive Director Shareholdings
KMP
Non-Executive Director
B McNamee
B Brook
M Clark
A Cuthbertson36
C Hewson
D Maskell37
M McDonald
A Watkins38
Number of
Shares
Acquired on
Exercise
of Rights
during year
Value of
Shares
Acquired on
Exercise of
Rights during
year US$35
Balance as at
1 July 2021
Number of
(Shares Sold)/
Purchased
Balance at 30
June 2022
161,681
5,604
3,405
111,693
764
–
3,255
1,715
563
200
160
59
403
209
241
122
117,930
41,225
33,550
11,320
84,523
40,099
50,553
23,407
118
318
448
–
74
–
118
118
162,362
6,122
4,013
111,752
1,241
209
3,614
1,955
There have been no movements in shareholdings of NEDs between 30 June 2022 and the date of this Report.
Table 18: Non-Executive Director Right Holdings
Balance
at 1 July
2021
Number
Granted39
Face
Value of
Rights
Granted
Fair
Value of
Rights
Granted
US$40
US$41
Number
Exer-
cised42
Value of
Rights
Exer-
cised
US$43
Balance
at 30
June
2022
Number
Vested
During
Year
Number
Lapsed
KMP
Security
Non-Executive Director
B McNamee
B Brook
M Clark
A
Cuthbertson46
C Hewson
D Maskell47
M McDonald
A Watkins48
Right
Right
Right
Right
278
80
80
–
PSU
4,480
Right
Right
Right
Right
202
–
121
–
569
127,628
125,644
240
53,833
52,995
160
179
–
401
417
240
243
35,888
35,331
37,443
37,945
–
–
89,945
88,548
93,534
92,081
53,833
52,995
54,505
53,659
563
200
160
59
–
403
209
241
122
117,930
41,225
33,550
11,320
–
84,523
40,099
50,553
23,407
–
–
–
–
–
–
–
–
–
284
120
80
120
4,480
200
208
120
121
563
200
160
59
–
403
209
241
122
Balance at
30 June 2022
Vest-
ed44
Unve-
sted45
–
–
–
–
284
120
80
120
– 4,480
–
–
–
–
200
208
120
121
35 The value at exercise date has been determined by the share price at the close of business on the exercise date multiplied by the number of Rights exercised
during 2022. The A$ value was converted to US$ at an average rate for the year of 1.37359.
36 The opening balance for A Cuthbertson is at 2 October 2021 being the date A Cuthbertson became a NED. All equity held by A Cuthbertson in his capacity
as a member of the Company’s Executive KMP until 1 October 2021 is disclosed elsewhere in this Report.
37 The opening balance for D Maskell is at 18 August 2021 being the date D Maskell became a NED.
38 The opening balance for A Watkins is at 18 August 2021 being the date A Watkins became a NED.
39 The number of Rights granted is determined by dividing the NEDs elected percentage of pre-tax base fee (minimum 20%) by the five day volume weighted
average price (VWAP) at which CSL shares were traded on the ASX ending on (and including) the last ASX trading day prior to the date of grant of the Rights
being 25 August 2021 of A$305.37. The Rights were granted on 26 August 2021 in two tranches. Tranche 1 had a vesting date of 21 February 2022 and Tranche 2
vests 22 August 2022. For the grant to A Cuthbertson on 4 October 2021, the VWAP was A$293.32.
40 The value at grant date has been determined by the share price at the close of business on the grant date of 26 August 2021 being A$308.10 multiplied by the
number of Rights granted during 2022. For the grant to A Cuthbertson on 4 October 2021, the closing share price was A$287.33. The A$ value was converted
to US$ at an average exchange rate for the year of 1.37359. The Rights have an expiry date fifteen years from the start of the financial year in which the Rights
were granted.
41 The value of Rights is calculated based on an assessment of the fair market value of the instruments in accordance with the accounting standards (refer
to Note 18 in the Financial Statements). The fair value of each Right granted on 26 August 2021 was Tranche 1: A$304.00 and Tranche 2: A$302.62 multiplied
by the number of Rights granted during 2022. For the grant to A Cuthbertson, the fair value for Tranche 1 was A$292.17 and Tranche 2 was A$290.69.
42 Vesting and exercise occurred in relation to Tranche 2 of the 2021 grant and Tranche 1 of the 2022 grant. All Rights eligible vested at 100% during the year.
No Rights eligible to vest were lapsed.
43 The value at exercise date has been determined by the share price at the close of business on the exercise date multiplied by the number of Rights exercised
during 2022. The A$ value was converted to US$ at an average exchange rate for the year of 1.37359. Australian based NEDs have Rights exercised at the vesting
date and a holding lock is placed on the shares for a period of three to fifteen years as elected by the NED.
44 Vested Rights are exercisable to the NED at the end of the nominated restriction period. All vested Rights are currently unexercisable until the end of the
nominated restriction period.
45 Unvested Rights represent Tranche 2 of the 2022 grant that will vest on 22 August 2022, following the release of full year financial results.
46 The opening balance for A Cuthbertson is at 2 October 2021 being the date A Cuthbertson became a NED. All equity held by A Cuthbertson in his capacity
as a member of the Company’s Executive KMP until 1 October 2021 is disclosed elsewhere in this Report.
47 The opening balance for D Maskell is at 18 August 2021 being the date D Maskell became a NED.
48 The opening balance for A Watkins is at 18 August 2021 being the date A Watkins became a NED.
93
CSL Limited Annual Report 2021/22 10. Remuneration Governance
The following diagram illustrates CSL’s remuneration governance framework.
CSL Board:
The Board is responsible for the oversight and strategic direction of CSL. It monitors operational and financial performance,
human resources policies and practices, and approves the company’s budgets and business plans. It is also responsible
for overseeing CSL’s risk management, financial reporting and compliance framework.
The Board reviews, makes comment on and, as appropriate, approves remuneration recommendations from the HRRC.
The Board approves the remuneration and remuneration outcomes for the CEO and Non-Executive Directors and approves
the policies and processes that govern both.
HRRC:
The HRRC has oversight of all aspects of remuneration
at CSL. The Board has delegated responsibility to the
HRRC for reviewing and making recommendations
to the Board with regard to:
• Executive remuneration design;
• Approval of awards to the CEO;
• Senior executive succession planning;
• The design and implementation of any incentive
plan (including equity based arrangements);
• The remuneration and other benefits applicable
to NEDs; and
• The CSL diversity policy and measurable objectives
for achieving gender diversity.
The HRRC is able to approve the remuneration
of Executive KMP (excluding the CEO).
Members
Dr Megan Clark AC (Chair), Ms Carolyn Hewson AO,
Ms Marie McDonald and Ms Alison Watkins AM.
ARMC:
The ARMC assists the Board in the governance of CSL’s
financial reporting and disclosures, risk identification
and management, and compliance, and oversees and
monitors ESG performance.
The ARMC advises the HRRC on any material risk
management and financial matters that may impact
remuneration outcomes.
External Remuneration Advisers:
The Board and the HRRC may seek and consider advice
directly from external advisers, who are independent
of management.
In 2022 the HRRC engaged the services of Aon
Consulting in the U.S., and EY in Australia. Under
engagement and communication protocols adopted
by CSL, the market data and other advice were provided
directly to the HRRC by both Aon Consulting and EY.
Neither Aon Consulting nor EY provided Remuneration
Recommendations during the 2022 financial year.
Joint HRRC and ARMC meetings:
The Committees meet jointly at least annually to review and consider relevant risk management
matters in the determination of the Executive KMP remuneration outcomes.
94
Directors’ ReportCSL Limited Annual Report 2021/22 10.1 HRRC Activities
During 2022, the HRRC met formally on seven occasions.
Activities undertaken include:
• Review of the executive remuneration framework;
• Review and consideration of investor feedback received
across the year;
• Appointment of external remuneration advisers;
• Review of senior executive appointments and
remuneration arrangements;
• Review of STI and LTI arrangements, and reward outcomes
for senior executives;
• Review of the CSL diversity objectives and report, and
gender pay review and progress against diversity objectives;
• Review of talent and succession planning for
senior executives;
• Review of long term remuneration strategy and global
trends in remuneration;
• Review of NED remuneration; and
• Review of the HRRC Charter and HRRC performance.
Full responsibilities of the HRRC are outlined in its Charter
(reviewed annually). The Charter is available at http://www.csl.
com.au/about/governance.htm
10.2 Remuneration Determination
The Board has discretion across each element of Executive
KMP reward and considers business performance, individual
performance and shareholder experience before setting and
approving reward outcomes.
Remuneration Recommendations – Reviewed on an annual
basis, the CEO makes a recommendation to the HRRC for
Executive KMP, with the HRRC recommending to the Board
for the CEO, any change to FR and STI and LTI targets for
the year ahead. Recommendations take into consideration
market conditions, position in market within the global
pharmaceutical/biotechnology peer group, individual
performance, role responsibilities and internal relativity.
Remuneration is reviewed in the context of Total Reward.
There is a higher proportion of Total Reward in the form
of performance related variable pay.
STI Outcomes – A formal review of Executive KMP progress
against KPIs is conducted twice annually by the CEO and
annually by the Board for the CEO. Regular performance
conversations are held during the year. Following the full year
performance review, the CEO makes recommendations in
respect of Executive KMP to the HRRC. The HRRC and the
Board assess individual performance against KPIs at the end
of the financial year, and approve the actual STI payments
to be made. The Board determines the outcomes for the
CEO, based on recommendations from the HRRC, who are
informed by the Chairs of the Board and HRRC. The Board
believes this is the most appropriate method of measurement.
LTI Outcomes – The HRRC assesses performance against
the hurdle measures set at grant by the Board. Following this,
the HRRC undertakes a review to ensure the remuneration
outcomes are aligned with overall business performance and
the shareholder experience and then submits outcomes to
the Board for approval. The Board believes this is the most
appropriate method of measurement.
Board Discretion – Prior to approving CEO remuneration
outcomes and before finalising all other Executive KMP
outcomes, the Board holistically assesses the outcomes and
considers whether there are any circumstances warranting
application of the Malus and Clawback Policy. It also considers
the ‘Leading and Managing’ modifier and ensures that the
interaction of remuneration outcomes is in alignment with
risk management outcomes for the year and that any material
risk issues and behaviours and/or compliance breaches are
addressed. The Board’s assessment is informed by the review
undertaken by the HRRC in conjunction with the ARMC.
The Board has discretion to determine final vesting outcomes
to ensure outcomes are in line with CSL performance, market
reported financial outcomes and shareholder outcomes.
Discretion may be exercised to either increase or reduce
vesting outcomes, which includes reducing to zero.
In 2022, the Board reviewed the quality of earnings, impact
of COVID-19 and risk management outcomes across the year.
As the Vifor acquisition was not contemplated at the time of
setting the targets at the start of the financial year, the Board
used its discretion to adjust the outcomes of both NPAT and
CFO associated with the Vifor acquisition net costs. The CFO
outcome was also adjusted to remove the impact of the
favourable cash inflow resulting from the Treasury hedging
activity associated with the Vifor acquisition.
New Hires and Internal Promotions – The Remuneration
Framework as set out in section 3.2 applies to the remuneration
arrangements for any newly hired or promoted Executive
KMP, ensuring a market competitive Total Reward offering.
In the case of external hires, the HRRC and Board may
determine that it is appropriate for a commencement
benefit to be offered. Commencement benefits in the
form of cash and/or equity can be made to compensate
for remuneration being forfeited from a former employer.
For any foregone equity awards, CSL equity will typically be
used as compensation. Awards may be discounted to take
into consideration any performance conditions on the award
at the former employer and the HRRC will determine the
appropriate service and performance conditions on the CSL
award within the CSL framework. For internal promotions,
the HRRC may determine that an award of equity should
be made to ensure an appropriate Total Reward package.
This is typically done as hurdled equity under the LTI
framework described in section 3.2.5.
95
CSL Limited Annual Report 2021/22 10.3 Contractual Provisions for Executive KMP
Executive KMP are employed on individual service contracts that outline the terms of their employment, which include:
Duration of Contract
Notice Period Employee
Notice Period CSL*
Termination Payment
No fixed term
Six months
Six months
12 months
*CSL may also terminate at any time without notice for serious misconduct and/or breach of contract.
10.4 Other Transactions
10.6 Securities Dealing
The CSL Securities Dealing Policy prohibits employees from
using price protection arrangements (e.g. hedging) in respect
of CSL securities, or allowing them to be used. The Policy also
provides that no CSL securities can be used in connection
with a margin loan. Upon vesting of an award, an employee
may only deal in their CSL securities in accordance with the
Policy. A breach of the Policy may result in disciplinary action.
A copy of the Policy is available at http://www.csl.com.au/
about/governance.htm.
10.7 Minimum Shareholding Guideline
To be met within a target of the first five years of appointment,
or within five years for current incumbents, and to be held
whilst in the role at CSL, the following levels of vested equity
must be held:
• CEO: Three times base salary;
• Executive KMP: One times base salary; and
• NEDs: One times Board base fee.
As at 30 June 2022, all KMP hold, or are on track to hold,
the minimum shareholding requirement within the relevant
time period.
No loans were made, guaranteed or secured, directly or
indirectly by CSL or any of its subsidiaries, to any Executive
KMP or their related parties during 2022.
No loans were made to NEDs during 2022. To the extent
that there were transactions between the Company and
an organisation with which a NED may be connected or
associated, those transactions were all on normal commercial
arms’ length terms, immaterial, and the relevant NED had
no involvement in any procurement or other Board decision-
making related to the transaction.
10.5 Malus and Clawback Policy
CSL operates a Malus and Clawback Policy. ‘Malus’ means
adjusting or cancelling all or part of an individual’s variable
reward as a consequence of a materially adverse development
occurring prior to payment (in the case of cash incentives)
and/or prior to vesting (in the case of equity incentives).
‘Clawback’ means seeking recovery of a benefit paid to take
into account a materially adverse development that only
comes to light after payment, including shares delivered
post vesting.
The Board, in its discretion, may apply the policy to any
incentive provided to a senior executive, including a former
senior executive, upon the occurrence (or the discovery
of the occurrence) of any of the following events or conduct:
• material misstatement, omission or error in the financial
statements of a Group company or the CSL Group leading
to a senior executive receiving a benefit greater than the
amount that would have been received had such
misstatement, omission or error not occurred,
• fraud or dishonesty to CSL or any Group company,
• wilful engagement in conduct which is, or might reasonably
be expected to be, injurious to CSL or any Group company,
monetarily or otherwise, including, but not limited to, its
reputation or standing in its industry,
• intentional act that is materially adverse to the best interests
of CSL or any Group company,
• violation of any material law or regulation,
• adverse risk management outcomes, and/or
• material violation of CSL’s Code of Conduct or any other
policy governing the conduct of employees of CSL or any
Group company or any agreement or covenant entered into
between a senior executive and CSL or any Group company.
In 2022, following a joint review of reward outcomes by
both the HRRC and the ARMC, there was no application
of the policy.
96
Directors’ ReportCSL Limited Annual Report 2021/22 11. Additional Employee Equity Programs and Legacy Plan Information
In addition to the Executive Performance and Alignment Plan LTI program described earlier in this Report, CSL operates two
additional employee equity programs – the Global Employee Share Plan and the Retain and Grow Plan. An overview of those
programs is provided below.
During 2022, CSL completed two on-market purchases of shares for the purposes of employee share plan awards described
below. A total of 126,056 shares were purchased during the reporting period and the average price paid per share was A$267.60.
11.1 Global Employee Share Plan
• LTI opportunity set as % of local salary (converted
CSL’s Global Employee Share Plan (GESP) provides all
employees the opportunity to share in the ownership
of our company and share in our future.
Operating across two six month contribution periods, an
employee can elect to make post tax salary contributions
between A$365 and A$12,000 per six month period. The
employee then receives shares at a 15% discount to the
applicable market rate over the five day period up to and
including the first and last ASX trading days of the six month
period, whichever is the lower. Shares are then held in
restriction for a period of one or three years as determined
upfront by the employee. The shares may be issued or
purchased on market.
To participate in GESP an employee must have at least six
months service at the start of the contribution period.
Participation is open to permanent full or part time and fixed
term contract employees and excludes Executive Directors.
11.2 Retain and Grow Plan
The CSL Group Retain and Grow Plan (RGP) LTI program is
designed to attract, motivate and retain key talent across the
organisation. RGP provides eligible employees with longer-
term share ownership in CSL, enabling them to share in the
company’s success and any capital growth.
The RGP recognises those individuals in management roles
(Manager to Senior Vice President) across the CSL Group.
Awards under the RGP are not guaranteed and the CSL
Board will review participation on an annual basis.
Key plan elements are as follows
• A conditional ‘right’ to a CSL share (i.e. full value instrument)
or at the Board’s discretion, a cash equivalent payment. No
price is payable by the participant on grant or vesting of
rights. Shares are automatically allocated (or cash automatically
paid) without the need for exercise by a participant;
• The security granted is a RSU;
to A$ at grant);
• Number of RSUs determined using face value (five day
weighted average share price);
• Individual performance hurdle – must not fail to meet
performance expectations;
• 33% of RSUs will vest on the first and second anniversaries
of the Issue Date, with the remaining 34% vesting on the
third anniversary;
• There is no retesting of awards;
• On cessation of employment a ‘qualified leaver’ (such as
retirement or redundancy) will retain a pro-rated number
of RSUs based on time elapsed since grant date, subject
to original terms and conditions. If a participant is not
a ‘qualified leaver’, all unvested awards will be forfeited
unless the Board determines otherwise;
• In the event of a change of control, the Board, in its absolute
discretion, may determine that some or all of the awards
vest having regard to the performance of the participant
during the vesting period to the date of the change of
control event. Vesting may occur at the date of the change
of control event or an earlier vesting date as determined
by the Board; and
• No dividends or dividend equivalents are paid on unvested
awards. Participants are only eligible for dividends once
shares have been allocated following vesting of any RSUs.
RSUs do not carry any voting rights prior to vesting and
allocation of shares.
Our Senior Vice President and Vice President employees
participate in both the Executive Performance and Alignment
PSU (described in section 3.2.5) and RGP LTI Plans with
a higher portion of awards aligned to the executive plan.
The RGP is also used for commencement benefits, retention
and recognition awards at all levels of the organisation. The
difference to the annual program is the vesting schedule,
which is reviewed and determined on a case by case basis.
11.3 Key Characteristics of Prior Financial Year Performance Share Unit Grants
The following table provides information on the key characteristics of the LTI programs on foot during the 2022 reporting
period. The 2018 (granted October 2017), 2019 (granted September 2018), 2020 (granted September 2019) and 2021
(granted September 2020) PSU LTI awards have the same key characteristics as the 2021 award disclosed in section 3.2.5
with the exception of the hurdle, performance period, performance targets and vesting dates as outlined below.
Table 19: Key Characteristics of Prior Financial Year PSU Grants
Grant Date
1 Oct 2017
1 Sep 2018
1 Sept 2019
1 Sep 2020
Tranche
Performance
Measure
Performance Period
Performance Target
Vesting Date
ROIC
1 July 2017 –
30 June 2024
4
3
2
1
1 September 2021
Threshold – 24%
Target – 27%
Threshold – 22%
Target – 25%
Threshold – 20%
Target – 23%
97
CSL Limited Annual Report 2021/22 Consolidated Statement of Comprehensive Income
For the Year Ended 30 June 2022
Sales and service revenue
Influenza pandemic facility reservation fees
Royalties and license revenue
Other income
Total operating revenue
Cost of sales
Gross profit
Research and development expenses
Selling and marketing expenses
General and administration expenses
Total expenses
Operating profit
Finance costs
Finance income
Profit before income tax expense
Income tax expense
Net profit for the year
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Hedging transactions
– Changes in fair value
– Realised in profit and loss
Exchange differences on translation of foreign operations, net of hedges
on foreign investments
Items that will not be reclassified subsequently to profit or loss
Actuarial gains on defined benefit plans, net of tax
Changes in fair value on equity securities measured through other comprehensive
income, net of tax
Total other comprehensive (losses)/income
Total comprehensive income for the year
Earnings per share (based on net profit for the year)
Basic earnings per share
Diluted earnings per share
The consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
Consolidated Entity
2022
US$m
10,136.3
162.2
194.6
68.8
2021
US$m
9,979.5
160.1
125.7
44.7
10,561.9
10,310.0
(4,829.6)
(4,466.7)
5,732.3
(1,156.2)
(960.7)
(688.0)
(2,804.9)
2,927.4
(165.2)
17.4
2,779.6
(524.9)
2,254.7
5,843.3
(1,001.4)
(980.2)
(731.7)
(2,713.3)
3,130.0
(170.8)
3.9
2,963.1
(588.1)
2,375.0
134.7
(1.0)
–
–
(286.9)
198.9
34.7
(6.6)
(125.1)
2,129.6
US$
4.81
4.80
83.4
–
282.3
2,657.3
US$
5.22
5.21
Notes
3
7
3
4
12
12
12
19
12
10
10
98
CSL Limited Annual Report 2021/22 Consolidated Balance Sheet
As at 30 June 2022
CURRENT ASSETS
Cash and cash equivalents
Receivables and contract assets
Inventories
Current tax assets
Other financial assets
Total Current Assets
NON-CURRENT ASSETS
Property, plant and equipment
Intangible assets
Right-of-use assets
Deferred tax assets
Other receivables
Other financial assets
Retirement benefit assets
Total Non-Current Assets
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Interest-bearing liabilities and borrowings
Current tax liabilities
Provisions
Total Current Liabilities
NON-CURRENT LIABILITIES
Interest-bearing liabilities and borrowings
Retirement benefit liabilities
Deferred tax liabilities
Provisions
Other non-current liabilities
Total Non-Current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Retained earnings
TOTAL EQUITY
The consolidated balance sheet should be read in conjunction with the accompanying notes.
Consolidated Entity
Notes
2022
US$m
2021
US$m
14
15
5
11
9
8
9
4
15
11
18
15
11
16
11
18
4
16
15
12
12
19
10,436.4
1,657.2
4,333.0
29.9
4.2
1,808.8
1,711.2
3,780.6
84.3
4.8
16,460.7
7,389.7
7,016.6
2,638.1
1,292.0
517.5
12.8
402.9
5.4
11,885.3
28,346.0
2,301.2
4,494.0
131.5
181.5
6,434.3
2,669.7
1,101.7
529.5
6.6
21.5
3.9
10,767.2
18,156.9
2,089.4
473.8
313.0
227.4
7,108.2
3,103.6
5,163.8
189.0
670.1
101.7
535.7
6,660.3
13,768.5
14,577.5
483.8
590.3
13,503.4
14,577.5
5,333.1
286.4
459.4
107.8
485.3
6,672.0
9,775.6
8,381.3
(4,504.6)
633.2
12,252.7
8,381.3
99
CSL Limited Annual Report 2021/22 Consolidated Statement of Changes in Equity
For the Year Ended 30 June 2022
Contributed Equity
US$m
Other reserves
US$m
Retained earnings
US$m
Total
US$m
As at the beginning of the year
(4,504.6)
(4,561.0)
2022
2021
Profit for the year
Other comprehensive
(losses)/income
Total comprehensive
(loss)/income for the year
Transactions with owners
in their capacity as owners
Share-based payments
Dividends
Share issues
–
–
–
–
–
–
–
–
–
–
4,988.4
56.4
2022
633.2
–
2021
2022
2021
2022
2021
336.3
12,252.7
10,752.3
8,381.3
2,254.7
2,375.0
2,254.7
6,527.6
2,375.0
(159.8)
198.9
34.7
83.4
(125.1)
282.3
(159.8)
198.9
2,289.4
2,458.4
2,129.6
2,657.3
116.9
98.0
–
–
116.9
98.0
–
–
–
–
(1,038.7)
(958.0)
(1,038.7)
(958.0)
–
–
4,988.4
56.4
As at the end of the year
483.8
(4,504.6)
590.3
633.2
13,503.4
12,252.7
14,577.5
8,381.3
The consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
100
CSL Limited Annual Report 2021/22 Consolidated Statement of Cash Flows
For the Year Ended 30 June 2022
Cash Flows from Operating Activities
Profit before income tax expense
Adjustments for:
Depreciation, amortisation and impairment
Inventory provisions
Share-based payment expense
Provision for expected credit losses
Finance costs
Loss/(gain) on disposal of property, plant and equipment
Contingent consideration liabilities reversal
Unrealised foreign exchanges (gains)/losses
Changes in operating assets and liabilities:
(Increase)/decrease in receivables and contract assets
Increase in inventories
Increase in trade and other payables
(Decrease)/increase in provisions and other liabilities
Income tax paid
Finance costs paid
Proceeds from settlement of treasury lock
Net cash inflow from operating activities
Cash flows from Investing Activities
Payments for property, plant and equipment
Payments for intangible assets
Payments for equity securities
Payments for other investing activities
Net cash outflow from investing activities
Cash flows from Financing Activities
Proceeds from issue of shares
Dividends paid
Proceeds from borrowings
Repayment of borrowings
Principal payments of lease liabilities
Other financing activities
Net cash inflow/(outflow) from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Exchange rate variations on foreign cash and cash equivalent balances
Cash and cash equivalents at the end of the year
Reconciliation of cash and cash equivalents in the statement of cash flows:
Cash and cash equivalents
Bank overdrafts
Cash and cash equivalents at the end of the year
The consolidated statement of cash flows should be read in conjunction with the accompanying notes.
* These numbers have been revised from those published on 17 August 2022.
Consolidated Entity
Notes
2022
US$m
2021
US$m
2,779.6
2,963.1
1
3
2
10
11
11
668.3
223.8
116.8
3.4
165.2
1.3
(62.5)*
(60.2)
(44.6)
(902.3)
337.3*
(102.7)
(457.1)
(172.3)
134.7
589.6
208.3
91.8
3.5
170.8
(0.3)
–
70.4
36.5
(367.7)
454.9
56.4
(494.5)
(160.9)
–
2,628.7
3,621.9
(1,078.8)
(168.9)
(387.7)
(0.7)
(1,196.3)
(470.8)
–
(6.1)
(1,636.1)
(1,673.2)
4,988.4
(1,038.7)
4,092.7
(316.4)
(52.6)
2.5
7,675.9
8,668.5
1,730.1
(64.2)
10,334.4
56.4
(958.0)
38.7
(470.9)
(64.5)
(3.5)
(1,401.8)
546.9
1,151.3
31.9
1,730.1
10,436.4
1,808.8
(102.0)
10,334.4
(78.7)
1,730.1
101
CSL Limited Annual Report 2021/22 Notes to the Financial Statements
For the Year Ended 30 June 2022
Contents
About this Report
Notes to the financial statements:
Our Current Performance
Note 1: Segment Information
Note 2: Business Acquisition
Note 3: Revenue and Expenses
Note 4: Tax
Note 5: Inventories
Note 6: People Costs
Our Future
Note 7: Research and Development
Note 8: Intangible Assets
Note 9: Property, Plant and Equipment
Returns, Risk & Capital Management
Note 10: Shareholder Returns
Note 11: Financial Risk Management
Note 12: Equity and Reserves
Note 13: Commitments and Contingencies
Efficiency of Operation
Note 14: Cash and Cash Equivalents
Note 15: Receivables, Contract Assets and Payables
Note 16: Provisions
Other Notes
Note 17: Related Party Transactions
Note 18: Detailed Information – People Costs
Note 19: Detailed Information – Shareholder Returns
Note 20: Auditor Remuneration
Note 21: Deed of Cross Guarantee
Note 22: Parent Entity Information
Note 23: Subsequent Events
Note 24: Amendments to Accounting Standards
and Interpretations
102
102
104
104
105
105
107
109
110
113
113
113
116
118
118
119
125
127
128
128
128
130
131
131
132
135
136
137
139
139
140
About this Report
Notes to the financial statements:
Corporate information
CSL Limited (“CSL”) is a for-profit company incorporated and
domiciled in Australia and limited by shares publicly traded
on the Australian Securities Exchange. This financial report
covers the financial statements for the consolidated entity
consisting of CSL and its subsidiaries (together referred to
as the Group). The financial report was authorised for issue
in accordance with a resolution of directors on 16 August 2022.
A description of the nature of the Group’s operations and its
principal activities is included in the directors’ report.
a. Basis of preparation
This general purpose financial report has been prepared in
accordance with Australian Accounting Standards, other
authoritative pronouncements of the Australian Accounting
Standards Board, International Financial Reporting Standards
(IFRS) and the Corporations Act 2001. It presents information
on a historical cost basis, except for certain financial
instruments, which have been measured at fair value.
Amounts have been rounded off to the nearest hundred
thousand dollars.
The report is presented in US dollars, because this currency
is the pharmaceutical industry standard currency for reporting
purposes. It is the predominant currency of the Group’s
worldwide sales and operating expenses.
b. Principles of consolidation
The consolidated financial statements comprise the financial
statements of CSL and its subsidiaries as at 30 June 2022. CSL
has control of its subsidiaries when it is exposed to, and has
the rights to, variable returns from its involvement with those
entities and when it has the ability to affect those returns.
A list of significant controlled entities (subsidiaries) at year
end is contained in Note 17.
The financial results of the subsidiaries are prepared using
consistent accounting policies and for the same reporting
period as the parent company.
In preparing the consolidated financial statements,
all intercompany balances and transactions have been
eliminated in full. The Group has formed a trust to administer
the Group’s employee share plan. This trust is consolidated
as it is controlled by the Group.
102
CSL Limited Annual Report 2021/22 c. Foreign currency
While the presentation currency of the Group is US dollars,
entities in the Group may have other functional currencies,
reflecting the currency of the primary economic environment
in which the relevant entity operates. The parent entity,
CSL Limited, has a functional currency of US dollars.
CSL also has a practice of periodically conducting climate
change risk assessments. This year we concluded an
enterprise-wide risk assessment of our manufacturing
facilities, CSL Plasma operations and key warehouse and
third-party logistics infrastructure, some directly owned
by CSL.
If an entity in the Group has undertaken transactions in
foreign currency, these transactions are translated into
that entity’s functional currency using the exchange rates
prevailing at the dates of the transactions. Where the
functional currency of a subsidiary is not US dollars,
the subsidiary’s assets and liabilities are translated on
consolidation to US dollars using the exchange rates
prevailing at the reporting date, and its profit and loss is
translated at average exchange rates. All resulting exchange
differences are recognised in other comprehensive income
and in the foreign currency translation reserve in equity.
d. Other accounting policies
Significant accounting policies that summarise the
measurement basis used and are relevant to an
understanding of the financial statements are provided
throughout the notes to the financial statements.
e. Key judgements and estimates
In the process of applying the Group’s accounting policies,
a number of judgements and estimates of future events
are required. Material judgements and estimates are found
in the following notes:
Note 3: Revenue and Expenses
Note 4: Tax
Note 5:
Inventories
Note 6: People Costs
Note 8:
Intangible Assets
Note 11: Financial Risk Management
Page 105
Page 107
Page 109
Page 110
Page 113
Page 119
Note 15: Receivables, Contract Assets and Payables Page 128
The Group has assessed the impact of climate risk on its
financial reporting. The impact assessment was primarily
focused on the valuation and useful lives of intangible assets
and the identification and valuation of provisions and
contingent liabilities, as these are judged to be the key areas
that could be impacted by the current reasonably foreseeable
climate risks. No material accounting impacts or changes to
judgements or other required disclosures were noted. While
the Group’s assessment did not have a material impact for
the year ended 30 June 2022, this may change in future
periods as the Group regularly updates its assessment
of the impact of the lower carbon economy.
f. The notes to the financial statements
The notes to these financial statements have been organised
into logical groupings to help users find and understand the
information they need. Where possible, related information
has been provided in the same place. More detailed
information (for example, valuation methodologies and
certain reconciliations) has been placed at the rear of the
document and cross-referenced where necessary. CSL has
also reviewed the notes for materiality and relevance and
provided additional information where it is helpful to an
understanding of the Group’s performance.
g. Significant changes in current reporting period
The consolidated financial statements have been prepared
using the same accounting policies as used in the annual
financial statements for the year ended 30 June 2021.
There were no significant changes in accounting policies
during the year ended 30 June 2022, nor did the introduction
of new accounting standards lead to any change in
measurement or disclosure in these financial statements.
The Group has not adopted any accounting standards
that are issued but not yet effective. Significant accounting
policies that summarise the measurement basis used and
are relevant to an understanding of the financial statements
are provided in the annual financial report.
103
CSL Limited Annual Report 2021/22 Our Current Performance
Note 1: Segment Information
The Group’s segments represent strategic business units that offer different products and operate in different industries and
markets. They are consistent with the way the CEO (who is the chief operating decision-maker) monitors and assesses business
performance in order to make decisions about resource allocation. Performance assessment is based on EBIT (earnings before
interest and tax) and EBITDA (earnings before interest, tax, depreciation, amortisation and impairment). These measures are
different from the profit or loss reported in the consolidated financial statements which is shown after net interest and tax
expense. This is because decisions that affect net interest expense and tax expense are made at the Group level. It is not
considered appropriate to measure segment performance at the net profit after tax level.
The Group’s operating segments are:
• CSL Behring – manufactures, markets, and distributes plasma therapies (plasma products and recombinants), conducts
early-stage research on plasma and non-plasma therapies, excluding influenza, receives licence and royalty income from
the commercialisation of intellectual property and undertakes the administrative and corporate function required to support
the Group.
• CSL Seqirus – manufactures and distributes non-plasma biotherapeutic products and develops influenza related products.
Sales and service revenue
Influenza pandemic facility
reservation fees
Royalty and license revenue
Other income
CSL Behring
US$m
CSL Seqirus
US$m
Consolidated Entity
US$m
2022
8,359.6
–
194.6
44.2
2021
8,427.8
–
125.7
20.3
2022
1,776.7
162.2
–
24.6
2021
1,551.7
160.1
–
24.4
2022
10,136.3
162.2
194.6
68.8
2021
9,979.5
160.1
125.7
44.7
Total segment revenue
8,598.4
8,573.8
1,963.5
1,736.2
10,561.9
10,310.0
Segment gross profit
Segment gross profit %
4,579.9
53.3%
4,847.6
56.5%
1,152.4
58.7%
995.7
57.3%
5,732.3
54.3%
5,843.3
56.7%
Segment EBIT
2,192.7
2,646.9
734.7
483.1
2,927.4
3,130.0
Consolidated operating profit
Finance costs
Finance income
Consolidated profit before tax
Income tax expense
Consolidated net profit after tax
Amortisation
Depreciation
Impairment1
67.4
375.9
125.8
66.6
343.4
93.3
Segment EBITDA
2,761.8
3,150.2
29.4
69.8
–
833.9
2,927.4
(165.2)
17.4
2,779.6
(524.9)
2,254.7
96.8
445.7
125.8
3,130.0
(170.8)
3.9
2,963.1
(588.1)
2,375.0
95.9
399.4
94.3
29.3
56.0
1.0
569.4
3,595.7
3,719.6
CSL Behring
US$m
CSL Seqirus
US$m
Intersegment
Elimination
US$m
Consolidated Entity
US$m
2022
2021
2022
2021
2022
2021
2022
2021
Segment assets
Segment liabilities
25,881.6
15,907.3
3,041.3
2,573.3
(576.9)
(323.7) 28,346.0
18,156.9
12,665.1
8,881.2
1,618.1
1,156.3
(514.7)
(261.9)
13,768.5
9,775.6
Other segment information – capital expenditure
Payments for property, plant and
equipment (“PPE”)
Payments for intangibles
Total capital expenditure
921.3
1,048.7
157.5
161.6
1,082.9
463.1
1,511.8
7.3
164.8
147.6
7.7
155.3
–
–
–
–
–
–
1,078.8
1,196.3
168.9
1,247.7
470.8
1,667.1
1
During the year ended 30 June 2022, the Group impaired certain intellectual property assets associated with the Calimmune acquisition ($112.6m). The Group
also derecognised the related contingent consideration liabilities ($62.5m) for amounts payable to former shareholders of Calimmune as well as the reversal
of the related deferred tax liabilities ($25.3m). The net impact to the profit or loss from all related adjustments was a loss of $24.8m.
104
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 1: Segment Information continued
Geographical areas of operation
The Group operates predominantly in Australia, the USA, Germany, the United Kingdom, Switzerland and China. The rest of the
Group’s operations are spread across many countries and are collectively disclosed as ‘Rest of World’.
Geographic
areas
Australia
US$m
United States
US$m
Germany
US$m
UK
US$m
Switzerland
US$m
China
US$m
Rest of World
US$m
Total
US$m
2022
2021
2022
2021
2022
2021 2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
External
operating
revenue
PPE,
right-of-use
assets and
intangible
assets
1,022.1
859.1 5,123.5 4,983.5
781.2 854.1 596.1 579.5
281.5
307.0 744.6 650.9 2,012.9
2,075.9 10,561.9 10,310.0
1,420.5 1,435.4 3,950.3 3,543.8 1,232.7 1,087.7 331.1 417.3 3,099.3 2,792.9 481.6 483.9
431.2
444.7 10,946.7 10,205.7
Note 2: Business Acquisition
Acquisition of Vifor Pharma AG (“Vifor”)
On 13 December 2021, the Group entered into a definitive
agreement to launch an all-cash public tender offer to acquire
100% of Vifor, which was subject to regulatory approvals.
Vifor is a Swiss based, global specialty pharmaceutical
company with a world-leading iron replacement platform
for treatment of diseases such as iron deficiency anaemia.
Through its extensive dialysis portfolio, Vifor has built a
strong presence in renal diseases which continues to benefit
from the introduction of novel therapies impacting disease
progression. A cornerstone of Vifor’s growth strategy has
been its strategic partnerships, which have allowed the
company to both broaden its portfolio and provide patients
access to the treatments they need.
Following closing of the tender offer, the Group commenced
buying Vifor’s shares on-market. As at 30 June 2022, the
Group had purchased 3.3% of Vifor’s shares for $387.7m with
a fair value of $381.1m, recorded as non-current other financial
assets in the balance sheet. These securities are carried
at fair value through other comprehensive income (“OCI”)
as discussed in Note 11(e) and Note 12(b).
The Group has secured funding for the acquisition of Vifor
as follows:
• Completion of a AUD$6,300m ($4,500m) Equity Placement
in December 2021 and a AUD$750m ($537m) Share
Purchase Plan in February 2022 (Note 12(b));
• Issuance of $4,000m in 144A senior unsecured notes
ranging from 5 – 40 years, in April 2022 (Note 11(d));
• $2,500m in bilateral credit facilities secured in May 2022 and
drawn down subsequent to 30 June 2022 in August 2022
(Note 11(d)); and
• Cash and other bank facilities.
During the year ended 30 June 2022, the Group has
incurred $27.7m in net finance costs (pre tax) associated
with acquisition financing. The Group has also incurred
$40.0m of acquisition and integration planning costs
(pre tax) in connection with the transaction that are
recognised as general and administrative expenses.
Subsequent to 30 June 2022, the Group has received
all necessary regulatory clearances and completed the
acquisition of Vifor on 9 August 2022. The Group has paid
$11,441.9m for 98% of Vifor shares (includes Vifor's shares
acquired as at 30 June 2022) and will proceed with
cancellation of the remaining publicly held Vifor shares, in
accordance with Swiss takeover rules. The Group will also
apply for the delisting of Vifor shares on the SIX. The total
consideration for 100% of Vifor shares is expected to be
approximately $11,648.1m.
The net book value of the group of assets acquired and the
fair values of the identifiable assets and liabilities, of the
business combination at the date of acquisition have not
been finalised as the acquisition occurred close to the date
these financial statements were authorised for release. The
acquired assets and liabilities includes publicly listed debt of
CHF (Swiss Franc) 465.0m as at the acquisition close. Funds
raised in anticipation of the acquisition are adequate to meet
the need to repay the debt when it falls due in September
2022. The purchase price accounting for the acquisition will
be determined within 12 months from the date of acquisition.
At the date of this report, it is not possible to provide a range
of outcomes or a reliable estimate of all fair values and
obligations. Preliminary purchase price accounting estimates
will be completed before the Group’s statutory accounts
for the half year ending 31 December 2022 are completed.
Note 3: Revenue and Expenses
Recognition and measurement of revenue
Revenue is recognised when the Group satisfies a
performance obligation by transferring control of the
promised good or service to a customer at an amount
that reflects the consideration to which an entity expects
to be entitled in exchange for the goods or services.
Further information about each source of revenue from
contracts with customers and the criteria for recognition follows.
Sales: Revenue is earned (constrained by variable considerations,
which include returns, discounts, rebates and allowances)
from the sale of products and services. Sales are recognised
when performance obligations are either satisfied over time
or at a point in time. Generally the supply of product under
a contract with a customer will represent the satisfaction
of a performance obligation at a point in time, which is when
control of the product passes to the customer.
105
CSL Limited Annual Report 2021/22 Note 3: Revenue and Expenses continued
Key Judgements and Estimates
Significant estimates on CSL Seqirus sales returns is performed in respect of the influenza season expected to be subject
to return. The estimate is performed with inputs including historical returns and customer sales data amongst other
factors. For contracts where the customer controls the plasma (tolling contracts) and the Group provides fractionation
services – the Group recognises revenue over time as the performance obligations are satisfied based upon a percentage
of completion of our fractionation services.
Royalties: Revenue from licensees of CSL intellectual property reflect a right to use the intellectual property as it exists at the
point in time in which the licence is granted. Where consideration is based on sales of product by the licensee, it is recognised
when the customer’s subsequent sales of product occurs.
License revenue: Revenue from licensees of CSL intellectual property reflects the transfer of a right to use the intellectual
property as it exists at the point in time in which the licence is transferred to the customer. Consideration is highly variable and
estimated using the most likely amount method. Subsequently, the estimate is constrained until it is highly probable that a
significant revenue reversal will not occur when the uncertainty is resolved. Revenue is recognised as or when the performance
obligations are satisfied.
Influenza pandemic facility reservation fees: Revenue from governments in return for access to influenza manufacturing
facilities in the event of a pandemic. Contracts are time-based and revenue is recognised progressively over the life of the
relevant contract, which aligns to the performance obligations being satisfied.
Other Income: Other income is derived from net income realised from activities that are outside of the ordinary business,
such as the disposal of property, plant and equipment and rental income.
Revenue from contracts with customers includes amounts in total operating revenue except other income.
Expenses
Finance costs
Lease related interest expense
Unrealised foreign currency (gains)/losses on debt
Total finance costs
Depreciation of PPE and right-of-use assets (Note 9)
Amortisation of intangibles (Note 8)
Impairment expenses (Notes 8 and 9)2
Total depreciation, amortisation and impairment expense
Write-down of inventory
Employee benefits expense
Recognition and measurement of expenses
Total finance costs: Includes interest expense and borrowing
costs, including lease related interest expense. Lease related
interest expense and borrowing costs are recognised as an
expense when incurred, except where finance costs are
directly attributable to the acquisition or construction of a
qualifying asset where they are capitalised as part of the cost
of the asset. Capitalised interest for qualifying assets during
the year ended 30 June 2022 was $26.7m (2021: $7.3m). The
weighted average interest rate applicable to capitalised
borrowing costs during the year was 2.4% (2021: 1.0%). Interest-
bearing liabilities and borrowings are stated at amortised
cost. Any difference between borrowing proceeds (net of
transaction costs) and the redemption value is recognised
in the statement of comprehensive income over the
borrowing period using the effective interest method.
Unrealised foreign currency (gains)/losses on debt is primarily
related to EUR350m and CHF400m of senior unsecured notes
in the US Private Placement market. The foreign currency risk
related to this debt was partially hedged as a cash flow hedge.
2022
US$m
142.8
35.2
(12.8)
165.2
445.7
96.8
125.8
668.3
223.8
2021
US$m
128.6
30.1
12.1
170.8
399.4
95.9
94.3
589.6
208.3
2,802.9
2,781.6
In connection with the 144A senior unsecured notes (Note 2),
the Group entered into a treasury lock (“T-lock”) prior to the
completion of the issuance of the notes to hedge against
increases in the Base US Treasury Yield until the settlement
date for a portion of the notes. The T-lock arrangement was
determined to be an effective cash flow hedge and resulted
in a gain of $134.7m being recognised in the statement of
comprehensive income. This amount will be reclassified into
finance costs in the same period as the associated interest
expense from the notes impacts earnings. For the year ended
30 June 2022, $1.0m was reclassified into finance costs.
Goods and Services Tax (GST) and other foreign equivalents:
Revenues, expenses and assets are recognised net of GST,
except where GST is not recoverable from a taxation authority,
in which case it is recognised as part of an asset’s cost of
acquisition or as part of the expense.
2
During the year ended 30 June 2022, the Group impaired certain intellectual property assets associated with the Calimmune acquisition ($112.6m).
The net impact to the profit or loss from all Calimmune related adjustments was a loss of $24.8m (refer to Note 1 for further details).
106
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 4: Tax
a. Income tax expense recognised in the statement of comprehensive income
Current tax expense
Current Year
Deferred tax expense/(recovery)
Origination and reversal of temporary differences
Total deferred tax expense
(Over)/under provided in prior years
Income tax expense
b. Reconciliation between tax expense and pre-tax net profit
The reconciliation between tax expense and the product of accounting profit before income tax
multiplied by the Group’s applicable income tax rate is as follows:
Accounting profit before income tax
Income tax calculated at 30% (2021: 30%)
Effects of different rates of tax on overseas income
Research and development incentives
(Over)/under provision in prior year
Revaluation of deferred tax balances
Other non-deductible expenses/(non-assessable revenue)
Income tax expense
c. Income tax recognised directly in equity
Deferred tax benefit
Share-based payments
Income tax benefit recognised in equity
d. Deferred tax assets and liabilities
Deferred tax asset
Deferred tax liability
Net deferred tax asset
Deferred tax balances reflect temporary differences attributable to:
Amounts recognised in the statement of comprehensive income
Inventories
Property, plant and equipment
Intangible assets
Trade and other payables
Recognised carry-forward tax losses
Retirement liabilities, net
Receivables and contract assets
Other assets
Interest-bearing liabilities
Other liabilities and provisions
Tax bases not in net assets for share-based payments
Total recognised in the statement of comprehensive income
Amounts recognised in equity
Share-based payments
Net deferred tax asset
2022
US$m
2021
US$m
353.6
442.2
222.8
222.8
(51.5)
524.9
2,779.6
833.9
(247.6)
(62.7)
(51.5)
17.7
35.1
524.9
0.1
0.1
517.5
(670.1)
(152.6)
134.6
(352.4)
(215.2)
160.4
3.0
23.1
(97.5)
–
50.3
88.3
17.9
(187.5)
34.9
(152.6)
127.5
127.5
18.4
588.1
2,963.1
888.9
(217.1)
(69.1)
18.4
(19.8)
(13.2)
588.1
6.2
6.2
529.5
(459.4)
70.1
291.8
(301.5)
(253.4)
93.1
95.7
55.2
(83.4)
2.8
57.7
68.5
8.8
35.3
34.8
70.1
107
CSL Limited Annual Report 2021/22 Note 4: Tax continued
e. Movement in temporary differences during the year
Opening balance
Charged to profit before tax
Charged to other comprehensive income
Charged to equity
Closing balance
Unrecognised deferred tax assets
Tax losses with no expiry date3
Current taxes
Current tax assets and liabilities are the amounts expected
to be recovered from (or paid to) tax authorities, under the
tax rates and laws in each jurisdiction. These include any rates
or laws that are enacted or substantively enacted as at the
balance sheet date.
Deferred taxes
Deferred tax liabilities are recognised for taxable temporary
differences. Deferred tax assets are recognised for deductible
temporary differences, carried forward unused tax assets and
unused tax losses, only if it is probable that taxable profit will
be available to utilise them.
The carrying amount of deferred income tax assets is
reviewed at the reporting date. If it is no longer probable
that taxable profit will be available to utilise them, they
are reduced accordingly.
2022
US$m
70.1
(213.4)
0.3
(9.6)
(152.6)
2021
US$m
191.0
(97.5)
(17.2)
(6.2)
70.1
0.4
0.4
Deferred tax is measured using tax rates and laws that are
enacted at the reporting date and are expected to apply
when the related deferred income tax asset is realised
or when the deferred income tax liability is settled.
Deferred tax assets and liabilities are offset only if a legally
enforceable right exists to set-off current tax assets against
current tax liabilities and if they relate to the same taxable
entity or group and the same taxation authority.
Income taxes attributable to amounts recognised in other
comprehensive income or directly in equity are also
recognised in other comprehensive income or in equity,
and not in the income statement.
CSL Limited and its 100% owned Australian subsidiaries have
formed a tax consolidated group effective from 1 July 2003.
Key Judgements and Estimates
The risk of uncertain tax positions, and recognition and recoverability of deferred tax assets, are regularly assessed.
To do this requires judgements about the application of income tax legislation in jurisdictions in which the Group
operates and the future operating performance of entities with carry forward losses. These judgements and
assumptions, which include matters such as the availability and timing of tax deductions and the application of the
arm’s length principle to related party transactions, are subject to risk and uncertainty. Changes in circumstances may
alter expectations and affect the carrying amount of deferred tax assets and liabilities. Any resulting adjustment to the
carrying value of a deferred tax item will be recorded as a credit or charge to the statement of comprehensive income.
3
Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable profit will be available for utilisation in the
entities that have recorded these losses.
108
Notes to the Financial StatementsCSL Limited Annual Report 2021/22
Note 5: Inventories
Raw materials
Work in progress
Finished goods
Total inventories
Raw Materials
Raw materials comprise collected and purchased plasma,
chemicals, filters and other inputs to production that will
be further processed into saleable products but have yet
to be allocated to manufacturing.
Work in Progress
Work in progress comprises all inventory items that are
currently in use in manufacturing and intermediate products
such as pastes generated from the initial stages of the
plasma production process.
Finished Products
Finished products comprise material that is ready for sale
and has passed all quality control tests.
2022
US$m
1,515.2
1,599.5
1,218.3
2021
US$m
1,309.1
1,249.6
1,221.9
4,333.0
3,780.6
Inventories generally have expiry dates and the Group
provides for product that is short-dated. Expiry dates for
raw material are no longer relevant once the materials
are used in production. The relevant expiry date at this
point then becomes that of the resultant intermediate
or finished product.
Inventories are carried at the lower of cost or net realisable
value. Cost includes direct material and labour and an
appropriate proportion of variable and fixed overheads.
Fixed overheads are allocated on the basis of normal
operating capacity.
Net realisable value is the estimated revenue that can be
earned from the sale of a product less the estimated costs
of both completion and selling. The Group assesses net
realisable value of plasma derived products on a basket
of products basis given their joint product nature.
Key Judgements and Estimates
Various factors affect the assessment of recoverability of the carrying value of inventory, including regulatory approvals
and future demand for the Group’s products. These factors are taken into account in determining the appropriate level
of provisioning for inventory.
109
CSL Limited Annual Report 2021/22 Note 6: People Costs
(a) Employee Benefits
Employee benefits include salaries and wages, annual leave and long-service leave, defined benefit and defined contribution
plans and share-based payments incentive awards.
People Cost 2022 – US$2,802.9m
People Cost 2021 – US$2,781.6m
Salaries and wages $2,597.0m
Defined benefit plan expense $41.5m
Defined contribution plan expense $47.6m
Salaries and wages $2,595.1m
Defined benefit plan expense $53.8m
Defined contribution plan expense $43.0m
Equity settled share-based payments expense (LTI) $116.8m
Equity settled share-based payments expense (LTI) $89.7m
Salaries and wages
Wages and salaries include non-monetary benefits, annual
leave and long service leave. These are recognised and
presented in different ways in the financial statements:
• The liability for annual leave and the portion of long service
leave that has vested at the reporting date is included in the
current provision for employee benefits.
• The liability for annual leave and the portion of long service
leave expected to be paid within twelve months is measured
at the amount expected to be paid.
• The liability for long service leave and annual leave expected
to be paid after one year is measured as the present value of
expected future payments to be made in respect of services
provided by employees up to the reporting date.
• The portion of long service leave that has not vested at the
reporting date is included in the non-current provision for
employee benefits.
110
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 6: People Costs continued
Defined benefit plans
Expenses recognised in the income statement are as follows:
Current service costs
Net interest cost
Past service costs
Total included in employee benefits expense
Defined benefit pension plans provide either a defined lump
sum or ongoing pension benefits for employees upon
retirement, based on years of service and final average salary.
Liabilities or assets in relation to these plans are recognised
in the balance sheet, measured as the present value of the
obligation less the fair value of the pension fund’s assets
at that date.
2022
US$m
2021
US$m
42.3
3.0
(3.8)
41.5
52.3
1.4
0.1
53.8
Present value is based on expected future payments to the
reporting date, calculated by independent actuaries using
the projected unit credit method. Past service costs are
recognised in income on the earlier of the date of plan
amendments or curtailment, and the date that the Group
recognises restructuring related costs.
Detailed information about the Group’s defined benefit
plans is in Note 18(a).
Key Judgements and Estimates
The determination of certain employee benefit liabilities requires an estimation of future employee service periods
and salary levels and the timing of benefit payments. These assessments are made based on past experience and
anticipated future trends. The expected future payments are discounted using the rate applicable to high quality
corporate bonds. Discount rates are matched to the expected payment dates of the liabilities.
Defined contribution plans
Equity settled share-based payment expense
The Group makes contributions to various defined contribution
pension plans and the Group’s obligation is limited to these
contributions. The amount recognised as an expense for the
year ended 30 June 2022 was $47.6m (2021: $43.0m).
Share-based payment expenses arise from plans that award
long-term incentives. Detailed information about the terms
and conditions of the share-based payment arrangements
is presented in Note 18(b).
111
CSL Limited Annual Report 2021/22 Note 6: People Costs continued
Outstanding share-based payment equity instruments
The number and weighted average exercise price for each share-based payment plan outstanding is as follows. All plans
are settled by physical delivery of shares except for instruments that may be settled in cash at the discretion of the Board.
Performance
Rights
Retain and Grow
Plan (RGP)
Executive
Performance and
Alignment Plan
(EPA)
Non-Executive
Director Plan (NED)
Global Employee
Share Plan (GESP)
Total
Weighted
average
exercise
Weighted
average
exercise
Weighted
average
exercise
Weighted
average
exercise
Weighted
average
exercise
Number
price Number
price Number
price Number
price Number
price Number
8,350
A$0.00 801,366
A$0.00
426,121
A$0.00
1,333
A$0.00
99,212
A$229.74 1,336,382
–
A$0.00
539,110
A$0.00
183,972
A$0.00
2,449
A$0.00 188,405
A$223.07
913,936
(8,350)
A$0.00 (315,709)
A$0.00 (148,680)
A$0.00
(2,529)
A$0.00
(184,141) A$225.78 (659,409)
–
–
–
–
A$0.00
(94,188)
A$0.00
(57,305)
A$0.00
A$0.00
–
A$0.00
–
A$0.00
–
–
A$0.00
–
A$0.00 (151,493)
A$0.00
(4,724) A$229.74
(4,724)
A$0.00 930,579
A$0.00 404,108
A$0.00
1,253
A$0.00
98,752
A$221.94 1,434,692
A$0.00
–
A$0.00
–
A$0.00
–
A$0.00
–
A$0.00
–
Outstanding
at the
beginning
of the year
Granted
during year
Exercised
during year4
Forfeited
during year
GESP true-up5
Closing
balance at the
end of the year
Exercisable
at the end
of the year
The share price at the dates of exercise (expressed as a weighted average) by equity instrument type, is as follows:
Performance Rights
RGP
EPA
GESP
2022
2021
A$297.02
A$290.92
A$308.97
A$280.98
A$309.08
A$281.68
A$303.87
A$263.25
(b) Key Management Personnel Disclosures
The remuneration of key management personnel is disclosed in section 17 of the Directors’ Report and has been audited.
Total compensation for key management personnel
Total of short term remuneration elements
Total of post employment elements
Total of other long term elements
Total share-based payments
Total of all remuneration elements
2022
US$
2021
US$
10,880,861
9,280,941
180,451
24,438
142,694
26,173
10,229,740
11,751,250
21,315,490
21,201,058
4
5
During the year ended 30 June 2022, 21,689 (RGP), 65 (EPA) and 89,653 (GESP) of the rights exercised were purchased on market.
The fair value of GESP equity instruments is estimated based on the assumptions prevailing on the grant date. In accordance with the terms and
conditions of the GESP plan, shares are issued at 15% discount to the lower of the ASX market price on the first and last dates of the contribution period.
112
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Our Future
Note 7: Research and Development
The Group conducts research and development activities to support future development of products to serve our patient
communities, to enhance our existing products and to develop new therapies.
All costs associated with our research and development activities are expensed as incurred as uncertainty exists up until the
point of regulatory approval as to whether a research and development project will be successful. At the point of approval, the
total cost of development has largely been incurred. Development costs incurred after regulatory approval are expensed unless
it meets the criteria to be recognised as intangible assets.
The Group also gains control of Intellectual Property (IP) through acquisitions or licence arrangements. In certain circumstances
the acquired IP will be capitalised, dependant on the phase of development.
For the year ended 30 June 2022, the research and development costs, net of recoveries, were $1,156.2m (2021: $1,001.4m).
Further information about the Group’s research and development activities can be found on the CSL website.
Note 8: Intangible Assets
Year
Cost
Accumulated
amortisation
Goodwill
US$m
Intellectual Property
US$m
Software
US$m
Intangible work
in progress
US$m
Total
US$m
2022
2021
2022
1,187.3
1,188.1
1,133.0
2021
1,131.1
2022
2021
785.6
789.8
2022
119.9
2021
77.7
2022
2021
3,225.8
3,186.7
–
–
(189.9)
(195.6)
(397.8)
(321.4)
–
–
(587.7)
(517.0)
Net carrying amount
1,187.3
1,188.1
943.1
935.5
387.8
468.4
119.9
77.7
2,638.1
2,669.7
Movement
Net carrying amount at
the beginning of the year
Additions
Transfers from intangible
capital work in progress
Transfers (to)/from
property, plant and
equipment
Reclassification due to
SaaS accounting policy
change (see annual
financial report at
30 June 2021)
Amortisation for the year
Impairment for the year6
Currency translation
differences
Net carrying amount
at the end of the year
–
–
–
–
–
–
–
–
–
–
–
–
1,188.1
1,187.2
935.5
509.5
468.4
460.9
77.7
133.4
2,669.7
2,291.0
126.0
450.0
–
–
–
–
–
(5.1)
6.6
24.1
–
–
–
(10.3)
8.1
64.8
31.3
197.4
489.4
84.1
(24.1)
(84.1)
–
–
–
–
(0.9)
(16.6)
(0.9)
(1.2)
(2.3)
(112.6)
(0.9)
(19.9)
(94.5)
(95.0)
–
–
–
–
(96.8)
(112.6)
(95.9)
(19.9)
(0.8)
0.9
(3.5)
1.9
(16.8)
20.6
1.5
(0.8)
(19.6)
22.6
1,187.3
1,188.1
943.1
935.5
387.8
468.4
119.9
77.7
2,638.1
2,669.7
–
–
–
–
6
During the year ended 30 June 2022, the Group impaired certain intellectual property assets associated with the Calimmune acquisition ($112.6m). The net
impact to the profit or loss from all Calimmune related adjustments was a loss of $24.8m (refer to Note 1 for further details).
113
CSL Limited Annual Report 2021/22 Note 8: Intangible Assets continued
Goodwill
Any excess of the fair value of the purchase consideration of an acquired business over the fair value of the identifiable net
assets (minus incidental expenses) is recorded as goodwill.
Goodwill is initially allocated to each of the cash-generating units but is monitored at the segment (business unit) level.
The aggregate carrying amounts of goodwill allocated to each business unit are as follows:
CSL Behring
Closing balance of goodwill as at 30 June
Goodwill is not amortised but is measured at cost less any
accumulated impairment losses. Impairment occurs when
a business unit’s recoverable amount falls below the carrying
value of its net assets.
The results of the impairment test show that each business
unit’s recoverable amount exceeds the carrying value
of its net assets, inclusive of goodwill. Consequently, there
is no goodwill impairment as at 30 June 2022 (2021: Nil).
A change in assumptions significant enough to lead to
impairment is not considered a reasonable possibility.
Intellectual property
Intellectual property acquired in a business combination
is initially measured at fair value. Intellectual property
acquired separately is initially measured at cost. Following
initial recognition, it is carried at cost less any accumulated
amortisation and impairment. Amortisation is calculated
on a unit-of-production or straight-line basis over periods
generally ranging from 5 to 20 years, except where it
is considered that the useful economic life is indefinite.
Certain intellectual property acquired may be considered
to have an indefinite life.
Contingent consideration in connection with the purchase
of individual assets outside of business combinations is
recognised as a financial liability only when a non-contingent
obligation arises (i.e. when milestone is met). The determination
of whether the payment should be capitalised or expensed
is usually based on the reason for the contingent payment.
If the contingent payment is based on regulatory approvals
received (i.e. development milestone), it will generally be
capitalised as the payment is incidental to the acquisition
so the asset may be made available for its intended use.
If the contingent payment is based on period volumes sold
(i.e. sales related milestone), it will generally be expensed.
Changes in the fair value of financial liabilities from contingent
consideration should be capitalised or expensed based on the
nature of the asset acquired (refer above), except for changes
due to interest rate fluctuations and the effect from unwinding
discounts. Interest rate effects from unwinding of discounts
as well as changes due to interest rate fluctuations are
recognised as finance costs.
2022
US$m
1,187.3
1,187.3
2021
US$m
1,188.1
1,188.1
Software
Costs incurred in developing or acquiring software, licences
or systems that will contribute future financial benefits are
capitalised. These include external direct costs of materials
and service and direct payroll and payroll related costs
of employees’ time spent on the project. Amortisation
is calculated on a straight-line basis over periods generally
ranging from 3 to 10 years. IT development costs include only
those costs directly attributable to the development phase
and are only recognised following completion of technical
feasibility, where the Group has the intention and ability
to use the asset.
Software-as-a-Service (SaaS) arrangements
SaaS arrangements are service contracts providing the Group
with the right to access the cloud provider’s application
software over the contract period. The Group applies
judgement in determining the nature and the resulting
accounting treatment of the costs of SaaS arrangements.
Costs incurred to configure or customise, and the ongoing fees
to obtain access to the cloud provider’s application software,
are recognised as operating expenses when the services are
received. Some of these costs incurred are for the development
of software code that enhances or modifies, or creates
additional capability to, existing on-premise systems and meets
the definition of and recognition criteria for an intangible asset.
These costs are recognised as intangible software assets and
amortised over the useful life of the software.
Recognition and measurement
The useful lives of intangible assets are assessed to be either
finite or indefinite. Intangible assets with finite lives are
amortised over the useful life of the asset on a straight-line
basis. Significant software intangible assets are amortised
over the useful life of up to ten years. The amortisation period
and method is reviewed at each financial year end at a
minimum. Intangible assets with indefinite useful lives are
not amortised. The useful life of these intangibles is reviewed
each reporting period to determine whether indefinite life
assessment continues to be supportable.
114
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 8: Intangible Assets continued
Impairment of intangible assets
Assets with finite lives are reviewed for impairment whenever
events or changes in circumstances indicate that the carrying
amount may not be recoverable. Intangible assets that have
an indefinite useful life (including goodwill) or not yet ready
for use are tested annually for impairment or more frequently
if events or changes in circumstances indicate that they may
be impaired.
An impairment loss is recognised in the statement of
comprehensive income for the amount by which the asset’s
carrying amount exceeds its recoverable amount. The recoverable
amount is the higher of an asset’s fair value less costs to sell
and value in use. For the purpose of assessing impairment,
assets are grouped at the lowest levels for which there are
separately identifiable cash flows (cash generating units),
other than goodwill that is monitored at the segment level.
Impairment losses recognised in respect of cash generating
units are allocated first to reduce the carrying amount
of any goodwill allocated to cash generating units, and then
to reduce the carrying amount of the other assets in the unit
on a pro-rata basis.
Key Judgements and Estimates
The impairment assessment process requires significant judgement. Determining whether goodwill, indefinite lived
intangibles and work in progress intangibles have been impaired requires estimation of the recoverable amount of the
cash generating units based on value-in-use calculations. The calculations use cash flow projections based on operating
budgets and a ten-year strategic business plan, after which a terminal value, based on our view of the longer term
growth profile of the business is applied. Cash flows have been discounted using an implied pre-tax discount rate
of 9.0% (2021: 8.0%) which is calculated with reference to external analyst views, long-term government bond rates
and the company’s pre-tax cost of debt.
The determination of cash flows over the life of an asset requires judgement in assessing the future demand for the
Group’s products, climate related impacts, any changes in the price and cost of those products and of other costs
incurred by the Group.
Factors considered in the exercise of our judgement include the progress of the research project, time to market and the
anticipated competitive landscape. These factors require judgement and may change in future periods, the impairment
analysis takes into account the latest available information.
115
CSL Limited Annual Report 2021/22 Note 9: Property, Plant and Equipment
Cost
Accumulated depreciation
Net carrying amount
Movement
Net carrying amount at the start
of the year
Transferred from capital work
in progress/intangible assets
Additions7
Disposals
Depreciation for the year
Impairment for the year8
Currency translation differences
Net carrying amount at the end
of the year
Land
US$m
2022
35.5
–
35.5
2021
39.5
–
39.5
2022
1,818.9
(297.2)
1,521.7
39.5
38.7
710.9
–
–
(3.5)
–
–
(0.5)
35.5
–
0.4
–
–
–
0.4
39.5
879.1
2.4
(1.5)
(50.8)
–
(18.4)
1,521.7
Buildings
US$m
Leasehold improvements
US$m
Plant and Equipment
Right-of-use assets
Capital work in progress
US$m
US$m
US$m
Total
US$m
2021
964.3
(253.4)
710.9
561.7
157.2
0.5
–
(29.2)
–
20.7
710.9
2022
597.4
(181.9)
415.5
2021
546.0
(157.0)
389.0
2022
4,078.4
(2,116.1)
1,962.3
2021
3,603.4
(1,936.3)
1,667.1
2022
1,848.8
(556.8)
1,292.0
2021
1,587.6
(485.9)
1,101.7
2022
3,081.6
–
2021
3,627.8
–
3,081.6
3,627.8
2022
11,460.6
(3,152.0)
8,308.6
2021
10,368.6
(2,832.6)
7,536.0
389.0
324.8
1,667.1
1,588.3
1,101.7
939.4
3,627.8
2,852.5
7,536.0
6,305.4
56.7
0.7
(0.3)
(26.9)
–
(3.7)
415.5
79.8
2.8
(0.1)
(20.7)
–
2.4
389.0
614.6
9.7
(4.4)
(277.5)
–
(47.2)
266.5
49.0
(4.1)
(272.4)
–
39.8
301.0
(0.2)
(90.5)
–
–
238.8
1,083.6
–
–
–
(77.1)
(1,550.4)
(1.6)
–
(13.2)
(64.6)
(502.6)
1,318.5
(8.1)
–
(74.4)
41.9
–
1,397.4
(11.5)
(445.7)
(13.2)
(154.4)
0.9
1,610.0
(12.3)
(399.4)
(74.4)
105.8
(20.0)
0.6
1,962.3
1,667.1
1,292.0
1,101.7
3,081.6
3,627.8
8,308.6
7,536.0
Property, plant and equipment
Land, buildings, capital work in progress and plant and
equipment assets are recorded at historical cost less, where
applicable, depreciation.
Right-of-use assets are measured at cost, less accumulated
depreciation, impairment losses, and adjusted for any
remeasurement of lease liabilities. The cost of right-of-use
assets includes the amount of lease liabilities and restoration
obligations recognised less any lease incentives received and
initial direct costs.
Depreciation is recognised on a systematic basis over
the estimated useful life of the asset, generally on
a straight-line basis.
Buildings
5 – 40 years
Plant and equipment
3 – 30 years
Leasehold improvements
5 – 25 years
Right-of-use assets
– Plasma centres
5 – 40 years
– Office and warehouses
1 – 39 years
– Land
40 – 101 years
The unit-of-production depreciation method, based on the
expected use or output as the asset is being used, may be
applied during the early stages of operation of manufacturing
facilities, as a substantial period of time may be required to
ramp up the production and operate at intended capacity.
This method is to be applied consistently from period to
period unless there is a change in the expected pattern
of consumption of those future economic benefits.
Assets’ residual values and useful lives are reviewed and
adjusted if appropriate at each reporting date. Items of
property, plant and equipment are derecognised upon
disposal or when no further economic benefits are expected
from their use or disposal.
Impairment testing for property, plant and equipment
will be performed if an impairment trigger is identified.
Gains and losses on disposals of items of property, plant and
equipment are determined by comparing proceeds with
carrying amounts and are included in the statement of
comprehensive income when realised.
40% of the Holly Springs facility, acquired with the Novartis
Influenza business, was legally owned by the US Government
prior to 1 July 2021. CSL has full control of the asset and 100%
of the value of the facility is included in the consolidated
financial statements. During the year ended 30 June 2022,
full legal title transferred to CSL following the completion
of the Final Closeout Technical Report.
Leasehold improvements
The cost of improvements to leasehold properties is amortised
over the unexpired period of the lease or the estimated useful
life of the improvement, whichever is the shorter.
7
8
Key capital projects during the year included the recombinant protein facility in Lengnau, the Marburg R&D Building, the CSL Melbourne Headquarters and
R&D facilities and the Biosecurity Facility in Melbourne.
During the year ended 30 June 2022, the Group recorded an impairment expense of $13m for assets associated with major capital projects which have been
identified as surplus to requirements as a result of the change in project scope for these projects.
116
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Land
US$m
2022
35.5
–
35.5
–
–
–
–
(3.5)
(0.5)
35.5
2021
39.5
–
39.5
0.4
–
–
–
–
0.4
39.5
2022
1,818.9
(297.2)
1,521.7
879.1
2.4
(1.5)
(50.8)
–
(18.4)
1,521.7
2021
964.3
(253.4)
710.9
157.2
0.5
(29.2)
–
–
20.7
710.9
2022
597.4
(181.9)
415.5
56.7
0.7
(0.3)
(26.9)
–
(3.7)
415.5
2021
546.0
(157.0)
389.0
79.8
2.8
(0.1)
(20.7)
–
2.4
389.0
Cost
Accumulated depreciation
Net carrying amount
Net carrying amount at the start
Transferred from capital work
in progress/intangible assets
Movement
of the year
Additions7
Disposals
Depreciation for the year
Impairment for the year8
Currency translation differences
Net carrying amount at the end
of the year
Property, plant and equipment
Buildings
US$m
Leasehold improvements
US$m
Plant and Equipment
US$m
Right-of-use assets
US$m
Capital work in progress
US$m
Total
US$m
2022
4,078.4
(2,116.1)
1,962.3
2021
3,603.4
(1,936.3)
1,667.1
2022
1,848.8
(556.8)
1,292.0
2021
1,587.6
(485.9)
1,101.7
2022
3,081.6
–
2021
3,627.8
–
3,081.6
3,627.8
2022
11,460.6
(3,152.0)
8,308.6
2021
10,368.6
(2,832.6)
7,536.0
39.5
38.7
710.9
561.7
389.0
324.8
1,667.1
1,588.3
1,101.7
939.4
3,627.8
2,852.5
7,536.0
6,305.4
614.6
9.7
(4.4)
(277.5)
–
(47.2)
266.5
49.0
(4.1)
(272.4)
–
39.8
–
301.0
(0.2)
(90.5)
–
(20.0)
–
(1,550.4)
238.8
1,083.6
–
(77.1)
–
0.6
(1.6)
–
(13.2)
(64.6)
(502.6)
1,318.5
(8.1)
–
(74.4)
41.9
–
1,397.4
(11.5)
(445.7)
(13.2)
(154.4)
0.9
1,610.0
(12.3)
(399.4)
(74.4)
105.8
1,962.3
1,667.1
1,292.0
1,101.7
3,081.6
3,627.8
8,308.6
7,536.0
Right-of-use (“ROU”) assets
The Group primarily has leases for plasma centres, office
buildings, warehouses, land and vehicles.
Except for short-term leases and leases of low value assets,
the Group recognises right-of-use assets at the
commencement date of the lease (i.e., the date the
underlying asset is available for use). The Group accounting
policy for lease liabilities has been discussed in Note 11(d).
Unless the Group is reasonably certain to obtain ownership
of the underlying asset at the end of the lease term, the
recognised right-of-use assets are depreciated on a straight-
line basis over the shorter of its estimated useful life and the
lease term.
Other arrangements
In May 2020, CSL entered into a strategic partnership with
Thermo Fisher Scientific (“TFS”) which included a lease of a
recombinant protein facility in Lengnau. The lease commenced
during the year ended 30 June 2022 and has a 20 year term
with two five year extension options. The lease has been
accounted for as an operating lease and the leased property,
plant and equipment continue to be presented in the
balance sheet. The total future operating lease payments
receivable from TFS (excluding extension options) were
$454.1m at 30 June 2022.
117
CSL Limited Annual Report 2021/22 Returns, Risk & Capital Management
Note 10: Shareholder Returns
(a) Dividends
Dividends are paid from the retained earnings and profits of CSL Limited, as the parent entity of the Group. (Refer to Note 22
for the parent entity’s retained earnings). During the year, the parent entity reported profits of $506.8m (2021: $106.1m). The
parent entity’s retained earnings as at 30 June 2022 were $6,322.6m (2021: $6,854.4m). During the financial year $1,038.7m was
distributed to shareholders by way of a dividend, with a further $568.4m being determined as a dividend payable subsequent
to the balance date.
Dividend Paid
Paid: Final ordinary dividend of US$1.18 per share, 10% franked at 30% tax rate, paid on 30 September 2021
for FY21 (prior year: US$1.07 per share, unfranked, paid on 9 October 2020 for FY20)
Paid: Interim ordinary dividend of US$1.04 per share, unfranked, paid on 6 April 2022 for FY22
(prior year: US$1.04 per share, unfranked, paid on 1 April 2021 for FY21)
Total paid
Dividend determined, but not paid at year end:
Final ordinary dividend of US$1.18 per share, 10% franked at 30% tax rate, expected to be paid on
5 October 2022 for FY22, based on shares on issue at reporting date. The aggregate amount of the
proposed dividend will depend on actual number of shares on issue at dividend record date (prior
year: US$1.18 per share, 10% franked at 30% tax rate, paid on 30 September 2021 for FY21)
2022
US$m
537.7
501.0
1,038.7
2021
US$m
484.7
473.3
958.0
568.4
537.0
The distribution in respect of the 2022 financial year represents a US$2.22 dividend paid for FY22 on each ordinary share held.
These dividends are approximately 46.2% of the Group’s basic earnings per share ('EPS') of US$4.81.
(b) Earnings per Share
CSL’s basic and diluted EPS are calculated using the Group’s net profit for the year of $2,254.7m (2021: $2,375.0m).
Basic EPS
Weighted average number of ordinary shares
Diluted EPS
Adjusted weighted average number of ordinary shares, represented by:
Weighted average number of ordinary shares
Plus:
2022
2021
US$4.81
US$5.22
468,754,857
454,865,604
US$4.80
US$5.21
470,117,188
456,203,803
468,754,857
454,865,604
Employee Share Plans (refer to Notes 6 and 18)
1,362,331
1,338,199
Diluted EPS differs from Basic EPS as the calculation takes into account potential ordinary shares arising from employee share
plans operated by the Group.
(c) Contributed Equity
The following table illustrates the movement in the Group’s contributed equity. Refer to Note 12 for further details.
Opening balance
Shares issued to employees via (Notes 6 and 18):
Performance Options Plan
Performance Rights Plan (for nil consideration)
Retain and Grow Plan (for nil consideration)
Executive Performance & Alignment Plan (for nil consideration)
Global Employee Share Plan (GESP)
2022
2021
Number of
shares
US$m
Number of
shares
US$m
455,125,994
(4,504.6) 454,048,707
(4,561.0)
–
8,350
294,020
148,615
94,488
–
–
–
–
8.7
308,186
197,646
253,126
138,369
179,960
–
–
24.4
–
–
–
32.0
–
–
Shares issued through Institutional Placement (Note 2)9
23,076,924
4,442.4
Shares issued through SPP (Note 2)8
2,957,875
537.3
Closing balance
481,706,266
483.8
455,125,994
(4,504.6)
9 Proceeds from shares issued through the Institutional Placement and SPP are presented net of $40.6m in transaction costs.
118
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 11: Financial Risk Management
CSL holds financial instruments that arise from the Group’s
need to access financing, from the Group’s operational
activities and as part of the Group’s risk management
activities. The Group is exposed to financial risks associated
with its financial instruments. Financial instruments comprise
cash and cash equivalents, receivables, contract assets, other
financial assets, payables and other liabilities, bank loans and
overdrafts, unsecured notes, and lease liabilities.
Source of Risk
a. Foreign Exchange Risk
The primary risks these give rise to are:
• Foreign exchange risk
• Interest rate risk
• Credit risk
• Funding and liquidity risk
• Capital management risk
Risk Mitigation
The Group is exposed to foreign exchange risk because of its
international operations. These risks relate to future commercial
transactions, assets and liabilities denominated in other
currencies and net investments in foreign operations.
Where possible CSL takes advantage of natural hedging (i.e. the
existence of payables and receivables in the same currency). The
Group also reduces its foreign exchange risk on net investments
in foreign operations by denominating external borrowings in
currencies that match the currencies of its foreign investments.
b. Interest Rate Risk
The Group is exposed to interest rate risk through its primary
financial assets and liabilities.
c. Credit Risk
The Group is exposed to credit risk from financial instruments
contracts and trade and other receivables. The maximum
exposure to credit risk at reporting date is the carrying amount,
net of any provision for impairment inclusive of any lifetime
expected credit losses under AASB 9, if applicable, of each
financial asset in the balance sheet.
d. Funding and Liquidity Risk
The Group is exposed to funding and liquidity risk from
operations and from external borrowing.
One type of this risk is credit spread risk, which is the risk that
in refinancing its debt, CSL may be exposed to an increased
credit spread.
Another type of this risk is liquidity risk, which is the risk of not
being able to refinance debt obligations or meet other cash
outflow obligations when required.
Liquidity and re-financing risks are not significant for the Group,
as CSL has a prudent gearing level and strong cash flows.
The Group mitigates interest rate risk on borrowings primarily
by entering into fixed rate arrangements, which are not subject
to interest rate movements in the ordinary course. If necessary,
CSL also hedges interest rate risk using derivative instruments
(including the T-lock entered into and settled during the year
as disclosed in Note 3 and Note 12). As at 30 June 2022, no
derivative financial instruments hedging interest rate risk were
outstanding (2021: Nil).
The Group mitigates credit risk from financial instruments
contracts by only entering into transactions with counterparties
who have sound credit ratings. Given their high credit ratings,
management does not expect any counterparty to fail to meet
its obligations. The Group minimises the credit risk associated
with trade and other debtors by undertaking transactions with
a large number of customers in various countries. The Group
enters into arrangements with distributors to sell products in
some markets. Certain distributors may contribute to 10% or
more revenue of the Group. Creditworthiness of customers
is reviewed prior to granting credit, using trade references
and credit reference agencies. As at 30 June 2022, the Group
was holding larger than normal cash balances to fund the
acquisition of Vifor (Note 2). The cash balances were held with
appropriately rated counterparties in accordance with board
approved policy.
The Group mitigates funding and liquidity risks by ensuring that:
• The Group has sufficient funds on hand to achieve its working
capital and investment objectives
• The Group focuses on improving operational cash flow and
maintaining a strong balance sheet
• Short-term liquidity, long-term liquidity and crisis liquidity
requirements are effectively managed, minimising the cost
of funding and maximising the return on any surplus funds
through efficient cash management
• It has adequate flexibility in financing to balance short-term
liquidity requirements and long-term core funding and
minimise refinancing risk
e. Capital Risk Management
The Group’s objectives when managing capital are to safeguard
its ability to continue as a going concern while providing returns
to shareholders and benefits to other stakeholders. Capital
is defined as the amount subscribed by shareholders to the
Company’s ordinary shares and amounts advanced by debt
providers to any Group entity.
The Group aims to maintain a capital structure, which reflects
the use of a prudent level of debt funding. The aim is to reduce
the Group’s cost of capital without adversely affecting the credit
margins applied to the Group’s debt funding. Each year the
Directors determine the dividend taking into account factors
such as profitability and liquidity.
119
CSL Limited Annual Report 2021/22 Note 11: Financial Risk Management continued
Risk management approach
b. Interest Rate Risk
At 30 June 2022, it is estimated that a general movement of one
percentage point in the interest rates applicable to investments
of cash and cash equivalents would have changed the Group’s
profit after tax by approximately $9.5m (2021: $12.7m). This
calculation is based on applying a 1% movement to the total
of the Group’s cash and cash equivalents at year end (excluding
debt and equity proceeds in connection with the acquisition
of Vifor as disclosed in Note 2).
At 30 June 2022, it is estimated that a general movement of
one percentage point in the interest rates applicable to floating
rate unsecured bank loans would have changed the Group’s
profit after tax by approximately $3.6m (2021: $3.9m). This
calculation is based on applying a 1% movement to the total
of the Group’s floating rate unsecured bank loans at year end.
The Group uses sensitivity analysis (together with other
methods) to measure the extent of financial risks and decide
if they need to be mitigated. If so, the Group’s policy is to use
derivative financial instruments, such as foreign exchange
contracts and interest rate swap and forward contracts,
to support its objective of achieving financial targets while
seeking to protect future financial security. The aim is to
reduce the impact of short-term fluctuations in currency
or interest rates on the Group’s earnings. Derivatives are
exclusively used for this purpose and not as trading or other
speculative instruments.
a. Foreign Exchange Risk
The objective is to match the contracts with committed future
cash flows from sales and purchases in foreign currencies to
protect the Group against exchange rate movements. The
Group reduces its foreign exchange risk on net investments
in foreign operations by denominating external borrowings
in currencies that match the currencies of its foreign
investments. The total value of forward exchange contracts
in place at reporting date is nil (2021: Nil).
Sensitivity analysis – USD values
Profit after tax – sensitivity to general movement of 1%
A movement of 1% in the USD exchange rate against AUD,
EUR, CHF and GBP would not generate a material impact
to profit after tax.
Equity – sensitivity to general movement of 1%
Any movement is recorded in the Foreign Currency Translation
Reserve. The below chart is based on decreasing the actual
exchange rate of US Dollars to AUD, EUR, CHF and GBP as at
30 June 2022 and 2021 by 1% and applying these adjusted
rates to the net assets (excluding investments in subsidiaries)
of the foreign currency denominated financial statements
of various Group entities. Amounts shown are in US$m.
FX Sensitivity on Equity (US$m)
15
10
5
0
-5
AUD
EUR
CHF
GBP
2022
2021
Any movement is recorded in the Foreign Currency Translation Reserve.
The below chart is based on decreasing the actual exchange rate of US
Dollars to AUD, EUR, CHF and GBP as at 30 June 2022 and 2021 by 1% and
applying these adjusted rates to the net assets (excluding investments
in subsidiaries) of the foreign currency denominated financial statements
of various Group entities. Amounts shown are in US$m.
120
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 11: Financial Risk Management continued
c. Credit Risk
The Group only invests its cash and cash equivalent financial assets with financial institutions having a credit rating of at least
‘BBB+’ or better, as assessed by independent rating agencies.
Floating Rate10
Non-Interest Bearing
US$m
US$m
Total
US$m
Average Closing
Interest Rate
%
2022
2021
2022
2021
2022
2021
2022
2021
Financial assets and
contract assets
Cash and cash equivalents
10,436.4
1,808.8
–
–
10,436.4
1,808.8
0.86%
0.02%
Receivables and contract
assets (excluding
prepayments)
Other financial assets11
–
–
–
–
10,436.4
1,808.8
1,496.0
1,570.3
1,496.0
1,570.3
407.1
1,903.1
26.3
407.1
26.3
1,596.6
12,339.5
3,405.4
–
–
–
–
Credit quality of financial assets
(30 June 2022 in US$m)
Credit quality of financial assets
(30 June 2021 in US$m)
Financial Institutions* $10,462.4m
Governments $224.2m
Hospitals $150.8m
Buying Groups $398.8m
Publicly traded securities $381.1m
Other $722.2m
Financial Institutions* $1,835.1m
Governments $240.1m
Hospitals $207.1m
Buying Groups $457.9m
Publicly traded securities $0m
Other $665.2m
* $10,436.4m of the assets held with financial institutions are held as cash
or cash equivalents and $26.0m of other financial assets. Financial
assets held with non-financial institutions include $1,496.0m of trade
and other receivables.
* $1,808.8m of the assets held with financial institutions are held as cash
or cash equivalents and $26.3m of other financial assets. Financial
assets held with non-financial institutions include $1,570.3m of trade
and other receivables.
The Group has not renegotiated any material collection/repayment terms of any financial assets in the current financial year.
Government or government-backed entities (such as hospitals) often account for a significant proportion of trade receivables.
As a result, the Group carries receivables from a number of Southern European governments. The credit risk associated with
trading in these countries is considered on a country-by-country basis and the Group’s trading strategy is adjusted accordingly.
The factors taken into account in determining the credit risk of a particular country include recent trading experience, current
economic and political conditions and the likelihood of continuing support from agencies such as the European Central Bank.
The following table analyses trade receivables that are past due and, where required, the associated provision for expected
credit losses (refer to Note 15). All other financial assets are less than 30 days overdue.
Trade receivables and contract assets
current
less than 30 days overdue
between 30 and 90 days overdue
more than 90 days overdue
Gross
Provision
Net
2022
US$m
1,083.0
20.5
40.2
24.1
2021
US$m
1,140.3
33.1
16.5
41.6
1,167.8
1,231.5
2022
US$m
(8.7)
–
–
(8.2)
(16.9)
2021
US$m
(9.6)
–
–
(13.9)
(23.5)
2022
US$m
1,074.3
20.5
40.2
15.9
2021
US$m
1,130.7
33.1
16.5
27.7
1,150.9
1,208.0
10 Floating interest rates represent the most recently determined rate applicable to the instrument at balance sheet date. All interest rates on floating rate
financial assets and liabilities are subject to reset within the next six months.
Other financial assets includes $381.1m in Vifor shares measured at fair value through OCI (Note 2 and Note 12).
11
121
CSL Limited Annual Report 2021/22 Note 11: Financial Risk Management continued
d. Funding and Liquidity Risk
The following chart summarises the Group’s maturity profile of debt on an undiscounted basis by facility (US$m). The chart
includes the maturity profile of the $4,000.0m in 144A senior unsecured notes excluding its mandatory redemption feature that
existed at 30 June 2022 (Note 11(d)). The mandatory redemption feature required repayment of the 144A senior unsecured notes
if the acquisition of Vifor had not completed by 31 December 2022. This mandatory redemption feature was removed
subsequent to 30 June 2022 following the acquisition of Vifor (Note 2).
1400
1300
1200
1100
1000
900
800
700
600
500
400
300
200
100
0
FY23
FY24
FY25
FY26
FY27
FY28
FY29
FY30
FY31
FY32
FY33
FY35
FY38
FY42
FY52
FY62
● Private Placement ● QDI ● Bank Debt ● 144A ● KfW Loans ● Other Borrowings
Non-consecutive years
The following table analyses the Group’s financial liabilities:
Interest-bearing liabilities and borrowings
Current
Bank overdraft – unsecured
Bank borrowings – unsecured
Senior notes – unsecured
Senior 144A notes – unsecured12
Lease liabilities
Other borrowings – secured
Non-current
Bank borrowings – unsecured
Senior notes – unsecured
Lease liabilities
Other borrowings – secured
2022
US$m
102.0
202.7
150.0
3,959.2
73.5
6.6
4,494.0
179.2
3,675.3
1,301.3
8.0
5,163.8
2021
US$m
78.7
66.2
250.0
–
77.8
1.1
473.8
220.0
3,993.9
1,104.6
14.6
5,333.1
12 The $3,959.2m in 144A senior unsecured notes, which are net of transaction costs of $40.8m, were issued on 27 April 2022 with the proceeds to be used to
partially fund the acquisition of Vifor (Note 2) and for general corporate purposes. These notes were classified as current at 30 June 2022 due to the existence of
a mandatory redemption feature at balance sheet date in the event the acquisition did not complete. Subsequent to 30 June 2022, the mandatory redemption
feature was removed following the acquisition of Vifor (Note 2) and the notes that have contractual maturities beyond 12 months will be subsequently
reclassified as non-current.
122
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 The Group’s lease liabilities are inclusive of extension options
the Group is reasonably certain to exercise based upon our
judgement as at the reporting date. Lease extension options
that the Group is not reasonably certain to exercise as at the
reporting date are appropriately excluded from the lease
liabilities. The Group applies judgement in evaluating whether
it is reasonably certain to exercise the option to renew. That is,
it considers all relevant factors that create an economic incentive
for it to exercise the renewal. After the commencement date,
the Group reassesses the lease term if there is a significant
event or change in circumstances that is within its control
and affects its ability to exercise (or not to exercise) the option
to renew (e.g., a change in business strategy).
The Group applies the short-term lease recognition
exemption to leases that have a lease term of 12 months or
less from the commencement date and do not contain a
purchase option. It also applies the lease of low-value assets
recognition exemption, which relates to leases such as office
photocopiers, gas storage cylinders, and other miscellaneous
low value assets. Lease payments on short-term leases and
leases of low-value assets are recognised as expense on a
straight-line basis over the lease term.
Contractual maturities of financial liabilities
The following table categorises the financial liabilities into
relevant maturity periods, taking into account the remaining
period at the reporting date and the contractual maturity
date. The weighted average contractual maturity date of
financial liabilities (excluding trade and other payables and
lease liabilities) has increased from 6 years as at 30 June 2021
to 12 years as at 30 June 2022. The amounts disclosed
represent principal and interest cash flows, so they may differ
from the equivalent reported amounts in the balance sheet.
Note 11: Financial Risk Management continued
Interest-bearing liabilities and borrowings
Interest-bearing liabilities and borrowings are recognised
initially at fair value, net of transaction costs incurred.
Subsequent to initial recognition, interest-bearing liabilities
and borrowings are stated at amortised cost, with any
difference between the proceeds (net of transaction costs)
and the redemption value recognised in the statement of
comprehensive income over the period of the borrowings.
Fees paid on the establishment of loan facilities that are yield
related are included as part of the carrying amount of the
loans and borrowings. Borrowings are classified as current
liabilities unless the Group has an unconditional right to defer
settlement of the liability for at least 12 months after the
reporting date.
Lease liabilities
At the commencement date of the lease, the Group
recognises lease liabilities measured at the present value
of lease payments to be made over the lease term. In
calculating the present value of lease payments, the Group
uses the incremental borrowing rate of the lessee at the lease
commencement date if the interest rate implicit in the lease
is not readily determinable. The Group exercises judgement
when determining the incremental borrowing rate based on
the interest that the lessee would have to pay to borrow over
a similar term, the funds necessary to obtain an asset of a
similar value to the right-of-use asset in a similar economic
environment, and observable inputs such as market interest
rates are used as applicable.
The lease payments include fixed payments (including
in-substance fixed payments) less any lease incentives
receivable, variable lease payments that depend on an index
or a rate, and amounts expected to be paid under residual
value guarantees. The lease payments also include the
exercise price of a purchase option reasonably certain
to be exercised by the Group and payments of penalties
for terminating a lease, if the lease term reflects the Group
exercising the option to terminate. The variable lease
payments that do not depend on an index or a rate are
recognised as an expense in the period in which the event
or condition that triggers the payment occurs. Subsequent
to initial recognition, lease liabilities are measured at
amortised cost. Lease liabilities are remeasured if there
is a modification, such as a change in the lease term,
a change in the in-substance fixed lease payments or a
change in the assessment to purchase the underlying asset.
123
CSL Limited Annual Report 2021/22 Note 11: Financial Risk Management continued
Contractual payments due as at 30 June
1 year or less
US$m
Between 1 year
and 5 years
US$m
Over 5 years
US$m
Total
US$m
Weighted average
interest rate
%
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2,301.2
2,089.4
62.7
31.2
–
–
–
36.4
–
–
–
–
2,301.2
2,089.4
–
–
62.7
67.6
2.0%
1.8%
38.8
38.1
149.4
148.7
27.7
40.8
215.9
227.6
1.0%
1.0%
102.0
78.7
–
–
–
–
102.0
78.7
–
–
358.8
350.7
1,771.8
1,343.6
1,964.5
2,768.7
4,095.1
4,463.0
2.8%
2.8%
177.4
–
1,209.5
–
6,153.6
5.0
506.3
507.6
–
–
–
7,540.5
–
4.1%
–
518.9
512.6
2.5%
1.0%
108.7
283.3
365.1
1,011.9
1,095.6
1,374.4
1,569.4
7.4
4.4
5.6
5.7
6.1
17.4
19.1
3.0%
5.1%
2.9%
5.2%
12.6
79.2
7.3
Trade and other payables
(non-interest bearing)
Bank borrowings – unsecured
(floating rates)13
Bank borrowings – unsecured
(fixed rates)
Bank overdraft – unsecured
(floating rates)13
Senior unsecured notes
(fixed rates)
Senior unsecured 144A notes
(fixed rates)14
Senior unsecured notes
(floating rates)13
Lease liabilities (fixed rates)
Other borrowings (fixed rates)
3,140.0
2,709.2
3,924.7
2,407.0
9,163.4
3,911.2
16,228.1
9,027.4
Available debt facilities
e. Fair value of financial assets and financial liabilities
As at 30 June 2022, the Group had the following available
interest-bearing liabilities and borrowings (undiscounted
and excludes bank overdrafts and lease liabilities):
Unsecured
• Five revolving committed bank facilities totalling
US$1,604.0m, which includes US$1,542.5m in undrawn
available funds
• Senior unsecured notes in the US private placement market
totalling US$3,435.0m
• Senior unsecured notes in the 144A US private placement
market totalling US$4,000.0m
• Unsecured notes in the Hong Kong market (“QDI”)
totalling US$500.0m
• Commercial paper program totalling US$750.0m which
remains undrawn and available
• Bank facility (“KFW”) totalling US$216.3m
In addition to the above, the Group entered into US$2,500.0m
in bilateral credit facilities (floating rate) in May 2022 with
proceeds restricted to the acquisition of Vifor (Note 2).
Subsequent to 30 June 2022, the Group has completed the
acquisition of Vifor (Note 2) and has drawn down the available
$2,500.0m in August 2022.
Secured
• Other secured borrowings totalling US$13.1m
The Group is in compliance with all debt covenants
as at 30 June 2022.
The carrying value of financial assets and liabilities is
materially the same as the fair value. The following methods
and assumptions were used to determine the net fair values
of financial assets and liabilities.
Cash
The carrying value of cash equals fair value, due to the liquid
nature of cash.
Receivables, contract assets and payables
Carrying value of receivables, contract assets and payables
with a remaining life of less than one year is deemed to equal
fair value.
Other financial assets
Other financial assets includes equity securities carried
at fair value through other comprehensive income which
are not held for trading. The publicly traded securities held
in connection with the acquisition of Vifor (refer to Note 2
and Note 12(b)) are measured at fair value calculated based
on quoted prices (unadjusted) in an active market.
Interest-bearing liabilities
Fair value is calculated based on the discounted expected
principal and interest cash flows, using rates currently
available for debt of similar terms, credit risk and
remaining maturities.
13 Floating interest rates represent the most recently determined rate applicable to the instrument at balance sheet date. All interest rates on floating rate
financial assets and liabilities are subject to reset within the next six months.
14 Contractual maturities of financial liabilities excludes the mandatory redemption feature included within the 144A senior unsecured notes. Refer to Note 11(d)
for detail regarding this redemption feature.
124
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 11: Financial Risk Management continued
Other financial liabilities
The Group also has foreign currency loans payable that have been designated as a cash flow hedge against forecast sale
transactions in foreign currency. An effective hedge is one that meets certain criteria. Gains or losses on the cash flow hedge
that relate to the effective portion of the hedge are recognised in equity. Gains or losses relating to the ineffective portion, if any,
are recognised in the statement of comprehensive income. Other liabilities also includes contingent consideration liabilities
from business combinations.
Key Judgements and Estimates
Contingent consideration liabilities are valued with reference to our judgement of the expected probability and timing
of potential future milestone payments, based upon level 3 inputs under the fair value hierarchy, which is then discounted
to a present value using appropriate discount rates with reference to the Group’s incremental borrowing rates.
Valuation of financial instruments
For financial instruments measured and carried at fair value, the Group uses the following to categorise the method used:
• Level 1: Items traded with quoted prices in active markets for identical liabilities
• Level 2: Items with significantly observable inputs other than quoted prices in active markets
• Level 3: Items with unobservable inputs (not based on observable market data)
There were no transfers between Level 1 and Level 2 during the year, or any transfers into Level 3.
Financial assets/(liabilities) measured at fair value
Publicly traded securities (Note 2)
Contingent consideration liabilities from business combinations (Note 15)15
Level 1
Level 3
2022
US$m
381.1
2021
US$m
–
(268.6)
(345.8)
Note 12: Equity and Reserves
(a) Contributed Equity
Ordinary shares issued and fully paid
Share buy-back reserve
Total contributed equity
2022
US$m
4,988.4
(4,504.6)
483.8
2021
US$m
–
(4,504.6)
(4,504.6)
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in equity
as a deduction, net of tax, from the proceeds. Where the Group reacquires its own shares, for example as a result of a share
buy-back, those shares are cancelled. No gain or loss is recognised in the profit or loss and the consideration paid to acquire the
shares, including any directly attributable transaction costs net of income taxes is recognised directly as a reduction in equity.
Ordinary shares receive dividends as declared and, in the event of winding up the company, participate in the proceeds from
the sale of all surplus assets in proportion to the number of and amounts paid up on shares held. Ordinary shares entitle their
holder to one vote, either in person or proxy, at a meeting of the company.
Share buy-backs were undertaken at higher prices than the original subscription prices which reduced the historical balance
for ordinary share contributed equity to nil. The share buy-back reserve was created to reflect the excess value of shares bought
over the original amount of subscribed capital. Information relating to changes in contributed equity is set out in Note 10.
15 During the year ended 30 June 2022, the Group derecognised contingent consideration liabilities ($62.5m) for amounts payable to former shareholders
of Calimmune. The net impact to the profit or loss from all related adjustments associated with the Calimmune acquisition (including impairment expense
disclosed in Note 1 and Note 3) was a loss of $24.8m.
125
CSL Limited Annual Report 2021/22 Note 12: Equity and Reserves continued
(b) Movement in Reserves
US$m
2022
2021
2022
2021
2022
2021
2022
2021
Share-based
payments
reserve (i)
Foreign currency
translation
reserve (ii)
Hedge
reserve (iii)
Other
reserves (iv)
Opening balance
426.7
328.7
206.5
Share-based payment expense
116.8
91.8
–
7.6
–
Net exchange gains/(losses) on
translation of foreign subsidiaries,
net of hedging reserve
Change in fair value of
investments valued through OCI
Fair value of cash flow hedge
Reclassification to profit and loss
Deferred tax
Closing balance
–
–
–
–
–
–
–
–
0.1
6.2
(286.9)
198.9
–
–
–
–
–
–
–
–
543.6
426.7
(80.4)
206.5
133.7
–
–
–
–
134.7
(1.0)
–
–
–
–
–
–
–
–
–
–
–
–
(6.6)
–
–
–
(6.6)
–
–
–
–
–
–
–
–
Total
2022
633.2
116.8
2021
336.3
91.8
(286.9)
198.9
(6.6)
134.7
(1.0)
0.1
–
–
–
6.2
590.3
633.2
Nature and purpose of reserves
i. Share-based payments reserve
The share-based payments reserve is used to recognise
the fair value of awards issued to employees.
ii. Foreign currency translation reserve
Where the functional currency of a subsidiary is not US
dollars, its assets and liabilities are translated on consolidation
to US dollars using the exchange rates prevailing at the
reporting date, and its profit and loss is translated at average
exchange rates.
All resulting exchange differences are recognised in other
comprehensive income and in the foreign currency
translation reserve in equity. Exchange differences arising
from borrowings designated as hedges of net investments
in foreign entities are also included in this reserve.
iii. Hedge reserve
The hedge reserve recognises the effective portion of gains
and losses on derivatives that are designated and qualify as
hedges. Amounts are subsequently reclassified into the profit
and loss as appropriate. The hedge reserve includes the cash
flow hedge reserve associated with the T-lock which settled
during 30 June 2022 (refer to Note 3).
iv. Other reserves
Other reserves includes equity securities purchased in
connection with the acquisition of Vifor (refer to Note 2 and
Note 11(e)). The Group has elected to recognise changes in
the fair value of these investments in equity securities in OCI
(excluding dividend income). These changes are accumulated
within the other reserves within equity. The Group transfers
amounts from this reserve to retained earnings when the
relevant equity securities are derecognised.
126
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 13: Commitments and Contingencies
(a) Capital Commitments
Commitments in relation to capital expenditure contracted but not provided for in the financial statements are payable as follows:
Not later than one year
Later than one year but not later than five years
Total
Capital Commitments
2022
US$m
403.2
83.3
486.5
2021
US$m
520.0
24.3
544.3
The Company entered into a lease for a building, currently under construction in Melbourne, as the new global headquarters.
The lease is expected to commence in 2023 with an initial term of 20 years and annual lease costs of approximately $15.0m.
(b) Contingent assets and liabilities
Litigation
In the ordinary course of business, the Group is exposed to contingent liabilities related to litigation for breach of contract
and other claims. Contingent liabilities occur when the possibility of a future settlement of economic benefits is considered
to be less than probable but more likely than remote. If the expected settlement of the liability becomes probable, a provision
is recognised.
Other contingent assets and liabilities
The Group has entered into collaboration arrangements, including in-licensing arrangements with various companies. Such
collaboration agreements may require the Group to make payments on achievement of stages of development, launch or
revenue milestones and may include variable payments that are based on unit sales (e.g. royalty payments). The amount of
royalties payable under the arrangements are inherently uncertain and difficult to predict, given the direct link to future sales
and the range of outcomes.
The maximum amount of unrecognised potential future commitments for such payments associated with uniQure and
Momenta licensing arrangements amount to $2,050.0m (2021: $2,105.0m). These amounts are undiscounted and are not
risk-adjusted, which include all such possible payments that can arise assuming all products currently in development are
successful and all possible performance objectives are met.
127
CSL Limited Annual Report 2021/22 Efficiency of Operation
Note 14: Cash and Cash Equivalents
Cash at bank and on hand
Cash deposits
Total cash and cash equivalents16
Cash and cash equivalents are held for the purpose
of meeting short term cash commitments rather than
for investment or other purposes. They are made up of:
• Cash on hand.
• At call deposits with banks or financial institutions.
• Investments in money market instruments that are readily
convertible to known amounts of cash and subject to
insignificant risk of changes in value.
Note 15: Receivables, Contract Assets and Payables
(a) Receivables and contract assets
Current
Trade receivables
Contract assets
Less: Provision for expected credit losses
Other receivables
Prepayments
Carrying amount of current receivables and contract assets
Non-Current
Long term deposits/other receivables
Carrying amount of non-current receivables and contract assets17
Receivables are initially recorded at their transaction price
and are generally due for settlement within 30 to 60 days
from date of invoice. Collectability is regularly reviewed
at an operating unit level.
A provision for expected credit losses (ECL) is recognised
based on the difference between the contractual cash
flows due in accordance with the contract and all the cash
flows that the Group expects to receive, discounted at an
approximation of the original effective interest rate. Cash
flows relating to short-term receivables are not discounted
if the effect of discounting is immaterial. When a trade
receivable for which a provision for expected credit loss has
been recognised becomes uncollectible in a subsequent
period, it is written off against the provision.
2022
US$m
1,531.0
8,905.4
10,436.4
2021
US$m
1,426.0
382.8
1,808.8
For the purposes of the cash flow statement, cash at the
end of the financial year is net of bank overdraft amounts.
Cash flows are presented on a gross basis. The GST component
of cash flows arising from investing and financing activities
that are recoverable from or payable to a taxation authority
are presented as part of operating cash flows.
2022
US$m
2021
US$m
965.8
202.0
(16.9)
1,150.9
332.3
174.0
1,657.2
12.8
12.8
997.0
234.5
(23.5)
1,208.0
355.7
147.5
1,711.2
6.6
6.6
ECLs are recognised in two stages. For credit exposures for
which there has not been a significant increase in credit risk
since initial recognition, ECLs are provided for credit losses
that result from default events that are possible within the
next 12-months (a 12-month ECL). For those credit exposures
for which there has been a significant increase in credit risk
since initial recognition, a loss allowance is required for credit
losses expected over the remaining life of the exposure,
irrespective of the timing of the default (a lifetime ECL).
For trade receivables and contract assets, the Group applies
a simplified approach in calculating ECLs. Therefore, the Group
does not track changes in credit risk, but instead recognises
a loss allowance based on lifetime ECLs at each reporting date.
The Group has established a provision matrix that is
based on its historical credit loss experience, adjusted for
forward-looking factors specific to the debtors and the
economic environment.
16 Cash and cash equivalents as at 30 June 2022 includes $8,938.9m in debt and equity proceeds received for the acquisition of Vifor (Note 2).
17 The carrying amount disclosed above is a reasonable approximation of fair value. The maximum exposure to credit risk at the reporting date is the carrying
amount of each class of receivable disclosed above. Refer to Note 11 for more information on the risk management policy of the Group and the credit quality
of trade receivables.
128
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 15: Receivables, Contract Assets and Payables continued
Contract assets and deferred revenue (contract liabilities):
The completion of performance obligations often differs
from contract payment schedules. A contract asset is initially
recognised for revenue earned from satisfying a performance
obligation; however, the receipt of consideration is conditional
upon the full satisfaction of the performance obligation
within the contract. Upon completing the full performance
obligation, the amount recognised as contract assets is
reclassified to trade receivables. Amounts billed in accordance
with customer contracts, but where the Group had not yet
provided a good or service, are recorded and presented
as part of deferred revenue. Deferred revenue is recognised
as revenue when the Group performs under the contract.
Other current receivables are recognised and carried at
the nominal amount due upon an unconditional right to
payment. Non-current receivables are recognised and carried
at amortised cost. They are non-interest bearing and have
various repayment terms.
As at 30 June 2022, the Group had a provision for expected credit losses of $16.9m (2021: $23.5m).
Opening balance as at 1 July
Allowance utilised/written back
Currency translation differences
Closing balance at 30 June
2022
US$m
23.5
(5.6)
(1.0)
16.9
2021
US$m
25.3
(2.3)
0.5
23.5
Non-trade receivables do not include any impaired or overdue amounts and it is expected they will be received when due.
The Group does not hold any collateral in respect to other receivable balances.
Key Judgements and Estimates
In applying the Group’s accounting policy to trade and other receivables with governments and related entities in South
Eastern Europe as set out in Note 11, significant judgement is involved in assessing the expected credit loss of trade
or other receivable amounts. Matters considered include recent trading experience, current economic and political
conditions and the likelihood of continuing support from agencies such as the European Central Bank.
(b) Trade and other payables
Current
Trade payables
Accruals and other payables
Carrying amount of current trade and other payables
Non-current
Accruals and other payables
Contingent consideration associated with business combinations
Carrying amount of other non-current liabilities
Trade payables, accruals and other payables: Represents the
notional amounts owed to suppliers for goods and services
provided to the Group prior to the end of the financial year
that are unpaid. Trade and other payables are non-interest
bearing and have various repayment terms but are usually
paid within 30 to 60 days of recognition.
Receivables and payables include the amount of GST
receivable or payable. The net amount of GST recoverable
from, or payable to, taxation authorities is included in other
receivables or payables in the balance sheet.
Contingent consideration associated with business
combinations: The Group recognised contingent
consideration associated with the past business combinations
for Vitaeris and Calimmune as non-current financial liabilities
at fair value, which is then remeasured at each subsequent
reporting date at fair value through profit and loss.
The fair value estimations typically depend on factors such
as technical milestones or market performance, and are
2022
US$m
2021
US$m
591.8
1,709.4
2,301.2
267.1
268.6
535.7
523.0
1,566.4
2,089.4
139.5
345.8
485.3
adjusted for the probability of their likelihood of potential
future payments, and are appropriately discounted to reflect
the impact of time. Refer to Note 11 for further details on the
fair value measurement. As at 30 June 2022, the maximum
amount of undiscounted potential future milestone payments
relating to historical business combinations are $470.0m
(2021: $795.0m), of which $268.6m (2021: $345.8m) is reflected
as a contingent consideration liability at fair value. The
reduction in the undiscounted potential future milestone
payments and contingent consideration liability at fair value
is largely due to the impairment of certain intellectual property
assets associated with the Calimmune acquisition (Note 8).
Changes in the fair value of contingent consideration
liabilities in subsequent periods are recognised in research
and development expenses for early-stage products and as
cost of sales for currently marketed products. The effect of
unwinding the discount over time for contingent consideration
carried at fair value is recognised as finance costs.
129
CSL Limited Annual Report 2021/22 Note 16: Provisions
Current
Carrying amount at the start of the year
Utilised
Additions
Currency translation differences
Carrying amount at the end of the year
Non-current
Carrying amount at the start of the year
Utilised
Additions
Reclassification from accruals
Currency translation differences
Carrying amount at the end of the year
Employee benefits
Other
US$m
2022
US$m
2021
US$m
2022
US$m
2021
Total
US$m
2022
211.7
(58.8)
30.5
(11.7)
171.7
47.9
(5.7)
2.6
–
(3.6)
41.2
156.1
(47.2)
97.2
5.6
211.7
41.7
(2.9)
8.2
–
0.9
47.9
15.7
(14.6)
9.3
(0.6)
9.8
59.9
–
4.6
–
(4.0)
60.5
0.8
(0.2)
15.5
(0.4)
15.7
–
–
34.6
25.0
0.3
59.9
227.4
(73.4)
39.8
(12.3)
181.5
107.8
(5.7)
7.2
–
(7.6)
101.7
US$m
2021
156.9
(47.4)
112.7
5.2
227.4
41.7
(2.9)
42.8
25.0
1.2
107.8
Provisions are recognised when all three of the following conditions are met:
• The Group has a present or constructive obligation arising from a past transaction or event
• It is probable that an outflow of resources will be required to settle the obligation
• A reliable estimate can be made of the obligation.
Provisions are not recognised for future operating losses. Provisions recognised reflect our best estimate of the expenditure
required to settle the present obligation at the reporting date. Where the effect of the time value of money is material,
provisions are determined by discounting the expected future cash flows to settle the obligation at a pre-tax discount rate
that reflects current market assessments of the time value of money and the risks specific to the obligation. Other provisions
includes the provision for asset retirement obligations and onerous contracts. Detailed information about employee benefits
is presented in Note 6.
130
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Other Notes
Note 17: Related Party Transactions
Ultimate controlling entity and subsidiaries
The ultimate controlling entity is CSL Limited, otherwise described as the parent company. The following table lists the Group’s
material subsidiaries.
Country of Incorporation
Percentage owned (%)
2022
2021
Company
CSL Limited
Subsidiaries of CSL Limited:
CSL Innovation Pty Ltd
CSL Behring (Australia) Pty Ltd
CSL Behring LLC
CSL Plasma Inc
CSL Behring GmbH
CSL Behring AG
CSL Behring Lengnau AG
CSLB Holdings Inc
CSL Finance Plc
CSL Finance Pty Ltd
Seqirus Pty Ltd
Seqirus UK Limited
Seqirus Vaccines Limited
Seqirus USA Inc
Seqirus Inc
Australia
Australia
Australia
USA
USA
Germany
Switzerland
Switzerland
US
UK
Australia
Australia
UK
UK
USA
USA
Related party transactions
All transactions with subsidiaries have been eliminated on consolidation.
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
131
CSL Limited Annual Report 2021/22 Note 18: Detailed Information – People Costs
(a) Defined benefit plans
The Group sponsors a range of defined benefit pension plans that provide either a lump sum or ongoing pension benefit for
its worldwide employees upon retirement. Entities of the Group who operate defined benefit plans contribute to the respective
plans in accordance with the Trust Deeds, following the receipt of actuarial advice. The surplus/deficit for each defined benefit
plan operated by the Group is as follows:
Pension Plan
CSL Pension Plan (Australia) – provides a lump sum
benefit upon exit
CSL Behring AG Pension Plan (Switzerland) – provides
an ongoing pension18
CSL Behring Union Pension Plan (USA) – provides
an ongoing pension
CSL Behring GmbH Supplementary Pension Plan
(Germany) – provides an ongoing pension
CSL Behring Innovation GmbH Supplementary
Pension Plan (Germany) – provides an
ongoing pension
bioCSL GmbH Pension Plan (Germany) – provides
an ongoing pension
CSL Behring KG Pension Plan (Germany) – provides
an ongoing pension
CSL Plasma GmbH Pension Plan (Germany) – provides
an ongoing pension
CSL Behring KK Retirement Allowance Plan (Japan)
– provides a lump sum benefit upon exit
CSL Behring S.A. Pension Plan (France) – provides
a lump sum benefit upon exit
CSL Behring S.p.A Pension Plan (Italy) – provides
a lump sum benefit upon exit
June 2022
US$m
Plan
Assets
Accrued
benefit
15.8
(13.5)
620.4
(620.4)
45.3
(42.2)
June 2021
US$m
Plan
surplus/
(deficit)
Plan
Assets
Accrued
benefit
Plan
surplus/
(deficit)
2.3
–
3.1
19.0
(18.6)
0.4
755.7
(760.1)
(4.4)
66.8
(63.3)
3.5
–
–
–
–
–
–
–
–
(138.0)
(138.0)
(22.6)
(22.6)
(2.5)
(2.5)
(12.0)
(12.0)
(0.4)
(0.4)
(11.4)
(11.4)
(1.4)
(1.4)
(0.7)
(0.7)
–
–
–
–
–
–
–
–
(207.2)
(207.2)
(34.1)
(34.1)
(3.2)
(3.2)
(19.0)
(19.0)
(0.4)
(0.4)
(15.3)
(15.3)
(1.9)
(1.9)
(0.9)
(0.9)
Total
681.5
(865.1)
(183.6)
841.5
(1,124.0)
(282.5)
In addition to the plans listed, CSL Behring GmbH, CSL
Behring Innovation GmbH and Seqirus GmbH employees
are members of multi-employer plans administered by
an unrelated third party. CSL Behring GmbH, CSL Behring
Innovation GmbH, Seqirus GmbH and their employees make
contributions to the plans and receive pension entitlements
on retirement. Participating employers may have to make
additional contributions in the event that the plans have
insufficient assets to meet their obligations. However, there
is insufficient information available to determine this amount
on an employer by employer basis. The contributions made
by CSL Behring GmbH, CSL Behring Innovation GmbH and
Seqirus GmbH are determined by the Plan Actuary and are
designed to be sufficient to meet the obligations of the plans
based on actuarial assumptions. Contributions made by CSL
Behring GmbH, CSL Behring Innovation GmbH and Seqirus
GmbH are expensed in the year in which they are made.
18 The CSL Behring AG Pension Plan (Switzerland) has a surplus of $75.6m that is not recognised, on the basis that future economic benefits are not available
to the entity in the form of a reduction in future contributions or a cash refund. The plan assets have been recognised up to the asset ceiling limit.
132
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 18: Detailed Information – People Costs continued
Movements in accrued benefits and assets
During the financial year the value of accrued benefits
decreased by $258.9m, mainly attributable to:
• Benefits paid by the plans of $91.9m;
• Actuarial adjustments, due primarily to changes in
assumptions at the end of the year than originally
anticipated by the actuary, generating a decrease in
accrued benefits of $162.9m. These adjustments do not
affect the profit and loss as they are recorded in other
comprehensive income;
• Favourable foreign currency movements of $63.0m
which are taken directly to the Foreign Currency
Translation Reserve;
• Offsetting these movements were increases from:
– Service cost charged to the profit and loss of $42.9m,
representing the increased benefit entitlement of
members, arising from an additional year of service
and salary increases;
– Interest costs of $7.2m, representing the discount rate
on benefit obligation and anticipated monthly benefit
payments; and
– Contributions made by employees of $13.4m.
Plan assets decreased by $160m during the financial year.
The decrease is mainly attributable to the following factors:
• Benefits paid by the plans of $87.2m;
• Actuarial adjustments due primarily to changes in
assumptions at the end of the year than originally
anticipated by the actuary and experience adjustments,
generating a decrease in plan assets of $5.0m;
• Changes in the asset ceiling18 resulting in the derecognition
of plan assets of $75.6m;
• Unfavourable foreign currency movements of $37.0m
which are taken directly to the Foreign Currency
Translation Reserve; and
• Offsetting these movements were increases from
contributions made by employer and employee that
increased plan assets by $40.4m and investment returns
increased plan assets by $4.3m.
The major categories of total plan assets are as follows:
Cash
Instruments quoted in active markets:
Equity instruments
Bonds
Unquoted investments – property
Other assets
Total Plan Assets
The principal actuarial assumptions, expressed as weighted averages, at the reporting dates are:
Discount rate
Future salary increases
Future pension increases
The variable with the most significant impact on the defined
benefit obligation is the discount rate applied in the
calculation of accrued benefits. A decrease in the average
discount rate applied to the calculation of accrued benefits
of 0.25% would increase the defined benefit obligation by
$27.6m. An increase in the average discount rate of 0.25%
would reduce the defined benefit obligation by $25.8m.
The defined benefit obligation will be discharged over an
extended period as members exit the plans. The plan actuaries
have estimated that the following payments will be required
to satisfy the obligation. The actual payments will depend
on the pattern of employee exits from the Group’s plans.
Within one year
$48.3m (2021: $50.9m)
Between two and five years $175.0m (2021: $185.0m)
Between five and ten years $83.8m (2021: $215.6m)
Beyond ten years
$558.2m (2021: $672.4m)
2022
US$m
24.1
225.8
224.0
177.7
29.9
681.5
2022
%
2.0%
2.2%
0.4%
2021
US$m
63.0
313.0
290.6
169.7
5.2
841.5
2021
%
0.7%
2.1%
0.5%
133
CSL Limited Annual Report 2021/22 Note 18: Detailed Information – People Costs continued
(b) Share-based payments
Long Term Incentives
A face value equity allocation methodology, being a volume
weighted average share price based on the market price
of a CSL share at the time of grant, is used to determine
the number of units granted to a participant under each
of the shared based payment plans, which are as follows:
• The Executive Performance and Alignment Plan (“EPA”)
grants Performance Share Units (“PSU”) to qualifying
executives. Vesting is subject to continuing employment,
satisfactory performance and the achievement of absolute
return measures. The return measures include EPS growth
and a seven-year rolling average Return on Invested
Capital (“ROIC”).
• The Retain and Grow Plan (“RGP”) grants Restricted Share
Units (“RSU”) to qualifying employees, participation in the
RGP plan is broader than in the EPA plan. Vesting is subject
to continuing employment and satisfactory performance.
EPA and RGP grants made prior to 1 September 2021
will vest in equal tranches on the first, second, third and
fourth anniversaries of the grant. EPA grants made from
1 September 2021 will vest on the third anniversary. RGP
grants made from 1 September 2021 will vest in equal
tranches on the first, second and third anniversaries of the
grant. For RGP commencement benefit awards, vesting
dates will vary.
There have been no changes to the terms of grant of any
existing instruments.
The fair value of the awards granted is estimated at the date
of grant using an adjusted form of the Black-Scholes model,
considering the terms and conditions upon which the PSUs
and RSUs were granted. There is no exercise price payable
on PSUs and RSUs.
The following grants were issued during the year ended
30 June 2022:
Date of grant
1 September 2021
1 March 2022
PSUs
183,972
–
RSUs
512,003
27,107
The relevant tranche of PSUs will exercise upon vesting on
1 September 2024. The relevant tranche of RSUs will exercise
upon vesting between September 2021 and March 2025.
The Non-Executive Directors Plan
The Non-Executive Directors (“NED”) pay a minimum of 20%
of their pre-tax base fee in return for a grant of Rights, each
Right entitling a NED to acquire one CSL share at no cost
(shares purchased on market). There is a nominated
restriction period, of three to fifteen years, after which the
NED will have access to their shares.
On 26 August 2021 and 4 October 2021, 2,449 Rights were
granted under the NED vesting on 21 February 2022 and
22 August 2022.
Global Employee Share Plan
The Global Employee Share Plan (“GESP”) allows employees
to make contributions from after tax salary up to a maximum
of A$6,000 per six month contribution period. The employees
receive the shares at a 15% discount to the applicable market
rate, as quoted on the ASX on the first day or the last day
of the six-month contribution period, whichever is lower.
Recognition and measurement
The fair value of awards granted are recognised as employee
benefit expense with a corresponding increase in equity.
Fair value is independently measured at grant date and
recognised over the period during which the employees
become unconditionally entitled to the award.
Fair value is independently determined using a combination
of the Binomial and Black-Scholes valuation methodologies,
including Monte Carlo simulation, considering the terms and
conditions on which the awards were granted. The fair value
of the awards granted excludes the impact of any non-market
vesting conditions, which are included in assumptions about
the number of awards that are expected to vest.
At each reporting date, the number of awards that are
expected to vest is revised. The employee benefit expense
recognised each period considers the most recent estimate
of the number of awards that are expected to vest. No expense
is recognised for awards that do not ultimately vest, except
where the vesting is conditional upon a market condition and
that market condition is not met. The Group does not have any
awards with a market condition as at 30 June 2022.
134
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 18: Detailed Information – People Costs continued
Valuation assumptions and fair values of equity instruments granted
The model inputs for share-based payments granted during the year ended 30 June 2022 included:
Fair Value Share Price
Exercise
Price
Expected
Volatility19
Life
Assumption
Expected
Dividend
Yield
Risk-free
Interest
Rates
(A$)
(A$)
(A$)
Performance Share Units (by grant date)20
1 September 2021 – Tranche 1
$302.44
$310.84
Nil
29.32%
36 months
0.91%
0.01%
Restricted Share Units (by grant date)
1 September 2021 – Tranche 1
$310.84
$310.84
1 September 2021 – Tranche 2
$309.44
$310.84
1 September 2021 – Tranche 3
$308.02
$310.84
1 September 2021 – Tranche 4
$306.63
$310.84
1 September 2021 – Tranche 5
$305.22
$310.84
1 September 2021 – Tranche 6
$303.84
$310.84
1 September 2021 – Tranche 7
$302.44
$310.84
1 September 2021 – Tranche 8
$299.70
$310.84
1 March 2022 – Tranche 1
1 March 2022 – Tranche 2
1 March 2022 – Tranche 3
1 March 2022 – Tranche 4
1 March 2022 – Tranche 5
1 March 2022 – Tranche 6
1 March 2022 – Tranche 7
1 March 2022 – Tranche 8
Rights (by grant date)
$263.92
$263.92
$262.44
$263.92
$261.00
$263.92
$259.54
$263.92
$258.10
$263.92
$256.65
$263.92
$255.24
$263.92
$253.81
$263.92
26 August 2021 – Tranche 1
$304.00
$305.37
26 August 2021 – Tranche 2
4 October 2021 – Tranche 1
4 October 2021 – Tranche 2
$302.62
$305.37
$292.17
$293.32
$290.69
$293.32
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
N/A
0 months
18.82%
6 months
21.57%
12 months
34.29%
18 months
31.48%
24 months
29.72%
30 months
29.32%
36 months
26.96%
48 months
N/A
0 months
28.27%
6 months
24.25%
12 months
24.08%
18 months
32.99%
24 months
30.94%
30 months
29.54%
36 months
29.19%
42 months
19.27%
21.69%
19.32%
21.24%
6 months
12 months
5 months
11 months
N/A
0.91%
0.91%
0.91%
0.91%
0.91%
0.91%
0.91%
N/A
1.11%
1.11%
1.11%
1.11%
1.11%
1.11%
1.11%
0.91%
0.91%
1.02%
1.02%
N/A
0.01%
0.01%
0.01%
0.01%
0.10%
0.19%
0.42%
N/A
1.02%
1.02%
1.02%
1.02%
1.26%
1.50%
1.59%
0.02%
0.02%
0.05%
0.05%
GESP (by grant date)21
3 September 2021 – Tranche 1
4 March 2022 – Tranche 1
$76.72
$33.97
$303.87
$227.15
$258.30
$224.33
18.82%
28.27%
6 months
6 months
0.91%
1.11%
0.01%
1.02%
Note 19: Detailed Information – Shareholder Returns
Retained earnings
Opening balance
Net profit for the year
Dividends
Actuarial gain on defined benefit plans
Deferred tax expense on actuarial gain/loss on defined benefit plans
Closing balance
Consolidated Entity
2022
US$m
2021
US$m
12,252.7
2,254.7
(1,038.7)
40.2
(5.5)
10,752.3
2,375.0
(958.0)
100.6
(17.2)
13,503.4
12,252.7
19 Expected volatility is based on historical volatility (based on the remaining life assumption of each equity instrument, adjusted for expected changes).
20 PSUs are subject to an EPS growth and ROIC performance measure.
21 Fair value of GESP shares is estimated based on the assumptions prevailing on the grant date. In accordance with the terms and conditions of the GESP plan,
shares are issued at a 15% discount to the lower of the ASX market price on the first and last dates of the contribution period.
135
CSL Limited Annual Report 2021/22 Note 20: Auditor Remuneration
During the year, the following fees were paid or were payable for services provided by CSL’s auditor and by the auditor’s
related practices:
AUDIT SERVICES – Ernst & Young Australia
Fees for auditing the statutory financial report of the parent covering the group and auditing
the statutory financial reports of any controlled entities
Fees for other assurance and agreed-upon-procedures services under other legislation
or contractual arrangements where there is discretion as to whether the service is provided
by the auditor or another firm
– Assurance services over the 144a bond issuance
– Sustainability assurance
– Agreed-upon procedures and other audit engagements
Fees for other services
Training
Due diligence
Remuneration advisory
2022
US$
2021
US$
2,402,268
1,956,994
326,152
106,873
146,124
39,000
150,295
190,832
–
66,819
90,045
80,000
211,449
357,646
Total fees to Ernst & Young (Australia)
3,361,544
2,762,953
AUDIT SERVICES – Ernst & Young Overseas Member Firms
Fees for auditing the statutory financial report of the parent covering the group and auditing
the statutory financial reports of any controlled entities
3,678,633
3,556,179
Fees for assurance services that are required by legislation to be provided by the auditor
2,721
13,845
Fees for other assurance and agreed-upon-procedures services under other legislation
or contractual arrangements where there is discretion as to whether the service is provided
by the auditor or another firm
– Agreed-upon procedures and other audit engagements
Fees for other services
Total fees to overseas member firms of Ernst & Young (Australia)
Total audit and other assurance services
Total non-audit services
Total auditor’s remuneration
147,474
35,127
77,009
35,224
3,863,955
3,682,257
6,810,245
5,760,891
415,254
684,319
7,225,499
6,445,210
136
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 21: Deed of Cross Guarantee
A deed of cross guarantee was executed between CSL Limited and some of its wholly-owned entities, namely CSL Behring
(Holdings) Pty Ltd, CSL Finance Pty Ltd, Seqirus (Australia) Pty Ltd, CSL Innovation Pty Ltd, Seqirus Pty Ltd, CSL Behring
(Australia) Pty Ltd, Seqirus Holdings Australia Pty Ltd, CSL IP Investments Pty Ltd and Amrad Pty Ltd (deregistered subsequent
to 30 June 2022). Under this deed, each company guarantees the debts of the others. By entering into the deed, these specific
wholly-owned entities have been relieved from the requirement to prepare a financial report and directors’ report under Class
Order 2016/785 (as amended) issued by the Australian Securities and Investments Commission.
The entities that are parties to the deed represent a ‘Closed Group’ for the purposes of the Class Order, and as there are no
other parties to the deed of cross guarantee that are controlled by CSL Limited, they also represent the ‘Extended Closed
Group’. A consolidated income statement and a summary of movements in consolidated retained profits for the year ended
30 June 2022 and 30 June 2021 and a consolidated balance sheet as at each date for the Closed Group is set out below.
Income Statement
Sales revenue
Cost of sales
Gross profit
Dividend income
Interest income
Research and development expenses
Selling and marketing expenses
General and administration expenses
Finance costs
Sundry expenses
Profit before income tax expense
Income tax expense
Profit for the year
Consolidated Closed Group
2022
US$m
1,180.7
(800.6)
380.1
1,371.9
9.0
(157.1)
(64.1)
(54.7)
(44.7)
(94.0)
1,346.4
(28.7)
1,317.7
2021
US$m
1,244.4
(652.0)
592.4
667.3
2.2
(139.4)
(60.2)
(110.7)
(32.9)
(116.8)
801.9
(51.8)
750.1
137
CSL Limited Annual Report 2021/22 Note 21: Deed of Cross Guarantee continued
Balance Sheet
CURRENT ASSETS
Cash and cash equivalents
Receivables and contract assets
Inventories
Total Current Assets
Non-Current Assets
Other receivables
Other financial assets
Property, plant and equipment
Deferred tax assets
Intangible assets
Retirement benefit assets
Total Non-Current assets
Total Assets
Current Liabilities
Trade and other payables
Provisions
Interest-bearing liabilities and borrowings
Other current liabilities
Total Current Liabilities
Non-Current Liabilities
Trade and other payables
Interest-bearing liabilities and borrowings
Provisions
Other non-current liabilities
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Contributed equity
Reserves
Retained earnings
TOTAL EQUITY
Summary of movements in retained earnings of the Consolidated Closed Group
Retained earnings at beginning of the financial year
Net profit
Actuarial losses on defined benefit plans, net of tax
Dividends paid
Retained earnings at the end of the financial year
138
Consolidated Closed Group
2022
US$m
2,292.4
561.3
232.1
3,085.8
3,020.7
14,641.8
1,333.5
84.7
20.0
2.3
19,103.0
22,188.8
2021
US$m
334.7
584.5
267.4
1,186.6
39.6
14,644.2
1,230.5
77.0
25.3
0.4
16,017.0
17,203.6
1,344.2
1,087.0
67.2
157.9
3.9
69.1
–
49.9
1,573.2
1,206.0
403.7
1,330.9
44.2
23.6
1,802.4
3,375.6
18,813.2
483.8
4.9
18,324.5
18,813.2
112.9
1,509.3
46.9
26.1
1,695.2
2,901.2
14,302.4
(3,476.6)
(268.7)
18,047.7
14,302.4
2022
US$m
2021
US$m
18,047.7
18,258.4
1,317.7
(2.2)
750.1
(2.8)
(1,038.7)
(958.0)
18,324.5
18,047.7
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Note 22: Parent Entity Information
Information relating to CSL Limited (“the parent entity”)
(a) Summary financial information
The individual financial statements for the parent entity show the following aggregate amounts:
Current assets
Total assets
Current liabilities
Total liabilities
Contributed equity
Foreign currency translation reserve
Retained earnings
Net assets/Total equity
Profit for the year
Total comprehensive income
2022
US$m
350.7
7,088.0
314.2
336.6
483.8
(55.0)
6,322.6
6,751.4
506.8
506.8
2021
US$m
373.6
6,333.1
342.5
4,038.3
(4,504.6)
(55.0)
6,854.4
2,294.8
106.1
106.1
(b) Guarantees entered into by the parent entity
The parent entity provides certain financial guarantees in the ordinary course of business. No liability has been recognised in
relation to these guarantees as the fair value of the guarantees is immaterial. These guarantees are mainly related to all external
debt facilities of the Group. In addition, the parent entity provides letters of comfort to indicate support for certain controlled
entities to the amount necessary to enable those entities to meet their obligations as and when they fall due, subject to certain
conditions (including that the entity remains a controlled entity).
(c) Contingent liabilities of the parent entity
The parent entity did not have any material contingent liabilities as at 30 June 2022 or 30 June 2021. For information about
guarantees given by the parent entity, please refer above and to Note 21.
(d) Contractual commitments for the acquisition of property, plant and equipment
The parent entity did not have any material contractual commitments for the acquisition of property, plant and equipment
as at 30 June 2022 or 30 June 2021.
Note 23: Subsequent Events
Other than the impact of the acquisition of Vifor (Note 2 and Note 11), there are no other matters or circumstances which have
arisen since the end of the financial year which have significantly affected or may significantly affect the operations of the
Group, results of those operations or the state of affairs of the Group in subsequent financial years.
139
CSL Limited Annual Report 2021/22 Note 24: Amendments to Accounting Standards and Interpretations
(a) Amendments to accounting standards and interpretations adopted by the Group
The Group has adopted the following amendment to the accounting standards. This change did not have a material impact
on the Group’s accounting policies nor did it require any restatement.
• AASB 2020-8 Amendments to Australian Accounting Standards – Interest Rate Benchmark Reform – Phase 2
(b) Amendments to accounting standards and interpretations not yet effective for the Group
A number of other accounting standards and interpretations have been issued and will be applicable in future periods.
While these remain subject to ongoing assessment, no significant impacts have been identified to date. These standards
have not been applied in the preparation of these Financial Statements.
Applicable to the Group for the year ending 30 June 2023:
• AASB 2020-3 Amendments to Australian Accounting Standards – Annual Improvements 2018-2020 and Other Amendments
– Reference to the Conceptual Framework – Amendments to AASB 3 Business Combinations
– Property, Plant and Equipment – Proceeds before Intended Use
– Onerous Contracts – Cost of Fulfilling a Contract
Applicable to the Group for the year ending 30 June 2024:
• AASB 2020-1 and AASB 2020-6 Amendments to Australian Accounting Standards – Classification of Liabilities as Current
or Non-current
– Classification of Liabilities as Current or Non-current – Amendments to AASB 101 Presentation of Financial Statements
• AASB 2021-2 Amendments to Australian Accounting Standards – Disclosure of Accounting Policies and Definition of
Accounting Estimates
• AASB 2021-5 Amendments to Australian Accounting Standards – Deferred Tax related to Assets and Liabilities arising
from a Single Transaction
140
Notes to the Financial StatementsCSL Limited Annual Report 2021/22 Directors’ Declaration
1) In the opinion of the Directors:
a) the financial statements and notes of the company and of the Group are in accordance with the Corporations Act 2001
(Cth), including:
i.
giving a true and fair view of the company’s and Group’s financial position as at 30 June 2022 and of their
performance for the year ended on that date; and
ii. complying with Australian Accounting Standards and Corporations Regulations 2001.
b) there are reasonable grounds to believe that the company will be able to pay its debts as and when they become
due and payable.
2) About this Report (a) in the notes to the financial statements confirms that the financial report complies with International
Financial Reporting Standards as issued by the International Accounting Standards Board.
3) This declaration has been made after receiving the declarations required to be made to the directors in accordance with
section 295A of the Corporations Act 2001 (Cth) for the financial period ended 30 June 2022.
4) In the opinion of the Directors, as at the date of this declaration, there are reasonable grounds to believe that the members
of the Closed Group identified in Note 21 will be able to meet any obligations or liabilities to which they are or may become
subject, by virtue of the Deed of Cross Guarantee dated 3 February 2017.
This declaration is made in accordance with a resolution of the directors.
Brian McNamee AO
Chairman
Melbourne
16 August 2022
Paul Perreault
Managing Director
141
CSL Limited Annual Report 2021/22
Ernst & Young
8 Exhibition Street
Melbourne VIC 3000 Australia
GPO Box 67 Melbourne VIC 3001
Tel: +61 3 9288 8000
Fax: +61 3 8650 7777
ey.com/au
Independent Auditor's Report to the Members of CSL Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of CSL Limited (the Company) and its subsidiaries (collectively the
Group), which comprises the consolidated balance sheet as at 30 June 2022, the consolidated statement
of comprehensive income, consolidated statement of changes in equity and consolidated statement of
cash flows for the year then ended, notes to the financial statements, including a summary of significant
accounting policies, and the directors' declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
a)
giving a true and fair view of the consolidated financial position of the Group as at 30 June 2022
and of its consolidated financial performance for the year ended on that date; and
b)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting
Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants
(including Independence Standards) (the Code) that are relevant to our audit of the financial report in
Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our
audit of the financial report of the current year. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate
opinion on these matters. For each matter below, our description of how our audit addressed the matter
is provided in that context.
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
financial report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
142
Notes to the Financial StatementsCSL Limited Annual Report 2021/22
2
1. Existence and valuation of inventories
Why significant
How our audit addressed the key audit matter
At 30 June 2022, the Group holds inventories of $4,333.0
million which are recorded at the lower of cost and net
realisable value. The Group’s accounting for inventories is
complex due to the nature of products being manufactured
requiring multiple inputs into the cost which leads to a risk
that gross inventories may be incorrectly valued.
Provisions can be recognised for all components of
inventories, including raw materials, work in progress and
finished goods. The Group considers a number of factors
when determining the appropriate level of inventory
provisioning, including regulatory approvals and future
demand for the Group’s products.
In addition, the geographic footprint of the Group and the
movements and sale of inventory between the Group’s
operations means both the existence of inventories and the
valuation of inventories is a key audit matter. This includes
considering whether any mark up of inventories from sales
within the Group is appropriately eliminated in the
consolidated financial statements.
The Group’s disclosures with respect to inventories is
included in Note 5 of the financial report.
We have assessed the carrying value of inventories,
including the determination of cost and provisions
for obsolescence and those that ensure inventory is
carried at the lower of cost and net realisable value
at 30 June 2022.
The existence of inventories has been addressed
through our assessment of the internal controls
which included attendance at periodic cycle counts
or through attendance at year-end inventory
stocktakes in locations with significant stock
holdings. We remained alert for obsolescence issues
during our observation of physical inventories.
We assessed the appropriateness of the
determination of inventory cost by assessing the
accuracy of the standard cost approach used by the
Group and assessing the recognition of variances
from standard costs.
We assessed whether inventory is recognised at the
lower of cost or net realisable value at period end by
comparing the inventory value measured at cost to
evidence supporting net realisable value such as the
current selling price of the products and achieved
margins.
We assessed whether the provisions for
obsolescence calculated by the Group reflect known
quality issues and commercial considerations
including product expiration, market demand, and
manufacturing plans, as well as their compliance
with Australian Accounting Standards.
We assessed the elimination of any unrealised profits
on transactions between group entities and resultant
tax consequences by the Group.
We have assessed the Group’s disclosures with
respect to inventories in Note 5 of the financial
report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
143
CSL Limited Annual Report 2021/22
3
Information Other than the Financial Report and Auditor’s Report Thereon
The directors are responsible for the other information. The other information comprises the information
included in the Company’s 2022 Annual Report other than the financial report and our auditor’s report
thereon. We obtained the Directors’ Report that is to be included in the Annual Report, prior to the date
of this auditor’s report, and we expect to obtain the remaining sections of the Annual Report after the
date of this auditor’s report.
Our opinion on the financial report does not cover the other information and we do not and will not
express any form of assurance conclusion thereon, with the exception of the Remuneration Report and
our related assurance opinion.
In connection with our audit of the financial report, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial report or
our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information obtained prior to the date of this
auditor’s report, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true
and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for
such internal control as the directors determine is necessary to enable the preparation of the financial
report that gives a true and fair view and is free from material misstatement, whether due to fraud or
error.
In preparing the financial report, the directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of is not a guarantee that an audit conducted in
accordance with the Australian Auditing Standards will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of this financial report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
144
Notes to the Financial StatementsCSL Limited Annual Report 2021/22
4
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
► Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
► Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group’s internal control.
► Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
► Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in
our auditor’s report to the related disclosures in the financial report or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up
to the date of our auditor’s report. However, future events or conditions may cause the Group to
cease to continue as a going concern.
► Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events in
a manner that achieves fair presentation.
► Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group audit. We remain solely
responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate
threats or safeguards applied.
From the matters communicated to the directors, we determine those matters that were of most
significance in the audit of the financial report of the current year and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
145
CSL Limited Annual Report 2021/22
5
Report on the Audit of the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the directors' report for the year ended 30 June
2022.
In our opinion, the Remuneration Report of CSL Limited for the year ended 30 June 2022, complies with
section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration
Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an
opinion on the Remuneration Report, based on our audit conducted in accordance with Australian
Auditing Standards.
Ernst & Young
Kylie Bodenham
Partner
Melbourne
16 August 2022
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
146
Notes to the Financial StatementsCSL Limited Annual Report 2021/22
12 Share Information
CSL Limited
Issued Capital Ordinary Shares: 481,706,266 as at 30 June 2022;
481,706,266 as at 11 August 2022.
Details of incorporation
CSL’s activities were carried on within the Commonwealth
Department of Health until the Commonwealth Serum
Laboratories Commission was formed as a Statutory Act 1961
(Cth) (the CSL Act) on 2 November 1961. On 1 April 1991, the
Corporation was converted to a public company limited by
shares under the Corporations Law of the Australian Capital
Territory and it was renamed Commonwealth Serum
Laboratories Limited. These changes were brought into effect
by the Commonwealth Serum Laboratories (Conversion into
Public Company) Act 1990 (Cth). On 7 October 1991, the name
was changed to CSL Limited. The Commonwealth divested
all of its shares by public float on 3 June 1994.
The CSL Sale Act 1993 (Cth) amends the CSL Act to impose
certain restrictions on the voting rights of persons having
significant foreign shareholdings, and certain restrictions
on CSL itself. CSL ordinary shares (being the only class of
shares on issue) have been traded on the Australian Securities
Exchange (ASX) since 30 May 1994. Melbourne is the
Home Exchange.
In June 2014, CSL commenced a sponsored Level 1 American
Depository Receipts (ADR) program with the Bank of New
York Mellon. The sponsored ADR program replaced the
unsponsored ADR programs that have previously operated
with CSL’s involvement.
The ADRs are tradeable via licensed US brokers in the
ordinary course of trading in the Over-the-Counter (OTC)
market in the US. Particulars for the sponsored ADR program
are: US Exchange – OTC and DR Ticker Symbol – CSLLY.
On 14 February 2022 CSL announced that it had completed
a Share Purchase Plan raising A$750 million (US$534 million).
Substantial shareholders
The following table shows holdings of 5% or more of voting rights in CSL Limited’s shares as notified to CSL Limited under the
Australian Corporations Act 2001 (Cth), Section 671B as at 30 June 2022.
Title of class
Identity of person
or group
Date received
Date of change
Number owned
Ordinary Shares
Blackrock Group
2 December 2019
28 November 2019
27,353,205
Date of last notice
For the period between 1 July 2022 and 11 August 2022, the following table shows holdings of 5% or more of voting rights in CSL
Limited’s shares, as notified to CSL Limited under the Australian Corporations Act 2001 (Cth), Section 671B.
Title of class
Identity of person
or group
Date received
Date of change
Number owned
Ordinary Shares
State Street Group
22 July 2022
20 July 2022
24,324,468
Date of last notice
147
CSL Limited Annual Report 2021/22 Share Information
Voting rights – ordinary shares
At a general meeting, subject to restrictions imposed on
significant foreign shareholdings and some other minor
exceptions, on a show of hands each shareholder present has
one vote. On a poll, each shareholder present in person or by
proxy, attorney or representative has one vote for each fully
paid share held. In accordance with the CSL Act, CSL’s
Constitution provides that the votes attaching to significant
foreign shareholdings are not to be counted when they
pertain to the appointment, removal or replacement of more
than one-third of the directors of CSL who hold office at any
particular time. A significant foreign shareholding is one
where a foreign person has a relevant interest in 5% or more
of CSL’s voting shares.
Distribution of shareholdings as at 11 August 2022
Range
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total shareholders and shares on issue
Total holders
215,377
21,977
3,205
1,371
55
241,985
Shares
37,265,021
49,373,514
21,948,497
24,316,645
348,802,589
481,706,266
% of issued capital
7.74
10.25
4.56
5.05
72.41
100.00
Unmarketable parcels
Minimum parcel size
Holders
Shares
Minimum A$500.00 parcel at A$295.10 per share
(being the closing market price on 11 August
2022)
Shareholder Information
CSL’s Share Registry is overseen by Computershare.
Shareholders with enquiries go to investorcentre.com
where most common questions can be answered by virtual
agent Penny. There is an option to contact the Share Registry
by email if the virtual agent cannot provide the answer.
Alternatively, shareholders may telephone or write to the
Share Registry at the below address.
Separate shareholdings may be consolidated by advising
the Share Registry in writing or by completing a Request
to Consolidate Holdings form which can be found online
at investorcentre.com.
Change of address should be notified to the Share Registry
online via the Investor Centre at investorcentre.com, by
telephone or in writing without delay. Shareholders who
are broker sponsored on the CHESS sub-register must
notify their sponsoring broker of a change of address.
Direct payment of dividends into a nominated account
is mandatory for shareholders with a registered address in
Australia or New Zealand. All shareholders are encouraged
to use this option by providing a payment instruction online
2
464
464
via the Investor Centre at investorcentre.com or by obtaining
a direct credit form from the Share Registry or by advising
the Share Registry in writing with particulars.
CSL now offers shareholders the opportunity to receive
dividend payments in US dollars by direct credit to a US bank
account. Shareholders who wish to avail themselves of this
payment option for the 2022 final dividend payment must
provide their valid US bank account details to the Share
Registry by the dividend record date of 7 September 2022.
The Annual Report is produced for your information. The
default option is an online Annual Report via CSL.com. If you
opt to continue to receive a printed copy and you receive
more than one or you wish to be removed from the mailing
list for the Annual Report, please advise the Share Registry.
The 2022 Annual General Meeting (AGM) of CSL Limited
(ABN 99 051 588 348) will be held on Wednesday,
12 October 2022 at 10am (Melbourne time) at the Clarendon
Auditorium, Melbourne Convention and Exhibition Centre,
South Wharf, Melbourne 3000.
148
CSL Limited Annual Report 2021/22 CSL’s 20 largest shareholders as at 11 August 2022
Rank Name
Units
% Units
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
CITICORP NOMINEES PTY LIMITED
NATIONAL NOMINEES LIMITED
BNP PARIBAS NOMS PTY LTD
BNP PARIBAS NOMINEES PTY LTD
CITICORP NOMINEES PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
NETWEALTH INVESTMENTS LIMITED
AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED
CUSTODIAL SERVICES LIMITED
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
SOLIUM NOMINEES (AUSTRALIA) PTY LTD
ARGO INVESTMENTS LIMITED
MUTUAL TRUST PTY LTD
D W S NOMINEES PTY LTD
WASHINGTON H SOUL PATTINSON AND COMPANY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED – A/C 2
20
DIVERSIFIED UNITED INVESTMENT LTD
Totals: Top 20 holders of ORDINARY FULLY PAID SHARES (Total)
Total Remaining Holders Balance
156,879,305
80,929,848
43,864,101
14,650,128
14,240,663
4,851,848
4,463,727
3,778,698
3,158,675
2,276,078
2,239,500
1,712,092
1,707,673
1,497,321
1,186,509
905,878
793,208
637,210
573,544
565,000
340,911,006
140,795,260
32.57
16.80
9.11
3.04
2.96
1.01
0.93
0.78
0.66
0.47
0.46
0.36
0.35
0.31
0.25
0.19
0.16
0.13
0.12
0.12
70.77
29.23
Share Registry
America Depositary Receipts (ADRs)
Computershare Investor Services Pty Limited
The Bank of New York Mellon (BNY Mellon)
Yarra Falls, 452 Johnston Street
Abbotsford VIC 3067
Postal address:
GPO Box 2975 Melbourne VIC 3001
Enquiries within Australia: 1800 646 882
Enquiries outside Australia: +61 3 9415 4178
Website: investorcentre.com
Postal address:
BNY Mellon Shareowner Services
PO Box 30170
College Station, TX 77842-3170 USA
Enquiries within the United States: 1-888-BNY-ADRS
(1-888-269-2377)
Enquiries outside the United States: 201-680-6825
Email: shrrelations@cpushareownerservices.com
Website: www-us.computershare.com/investor
149
CSL Limited Annual Report 2021/22 13 Key Performance Data Summary
Performance Indicator
Economic Contribution
Operating revenue
Net profit
Economic value generated
Economic value distributed
New plasma centres
Sustainable Workforce
Our People
Total headcount
Total Board female
Total workforce female
Total people managers female
Total senior executives female
Total Recordable Injury
Frequency Rate (TRIFR)
Fatalities (including contractors)
Employee engagement
ESG employee engagement
Hotline calls (Ethics)
Social
Innovation
R&D investment
Clinical trials in operation
New product registrations
Safety and Quality
Regulatory audits of
manufacturing facilities and
plasma collection centres
Quality audits of suppliers
Safety related recalls
of finished product††
Pharmacovigilance audits
Community
Total contribution
Product access support (subset
of total community contribution)
Plasma donors willing
to donate again
Environment
Absolutes§
Energy consumption
Greenhouse gas emissions
Water consumption
Waste
Waste recycling rate
Measure
2019/20
2020/21
2021/22
More in 21/22 Annual
Report (page reference)
US$ million
US$ million
US$ million
US$ million
Number
Number
Percentage
Percentage
Percentage
Percentage
Per million
hours worked
for Non-CSL
Plasma sites
Per million
hours worked
for CSL Plasma
Number
Percentage
Number
9,151¶
2,103¶
9,158†
8,832†
40
27,009
44
57
44
30
For all sites –
7.2.
Methodology
for reporting
changed in
19/20 – please
see page 41 for
more.
0
76.4†
NA
136
US$ million
Number
Number
Number
Number
Number
Number
US$ million
US$ million
Percentage
Petajoules
Metric kilotonnes
Gigalitres
Metric kilotonnes
Percentage
922*†
34
29
401*†
476*†
2*†
50
44.6^
10.6†^
99†
3.79
344
4.25
66.75
46
10,310¶
2,375¶
10,314†
9,959†
25
25,415
43
57
44
30
10,562¶
2,255¶
10,570†
9,866†
27
30,398†
44†
61†
46†
31
1.9†
1.4†
11.2†
0†
73.7†
NA
259
1,001†
43
28
365†
481**
3†
64
55.2#
20.1#†
99†
3.73
326
4.44
59.02
40
10.7†
0†
77.9†
78.2†
295
1,156
58
24
406†
678†
0†
69
50.0
17.8†
95^^
3.92
347
4.67
55.54
38
98
48
16
37
41
41
40
41
61
16
34
36
50
50
52
51
48
43
* Excludes CSL Behring’s operations in Wuhan, China (previously Ruide).
† Data for nominated period has received limited assurance by Ernst & Young.
¶ Operating Revenue and Net Profit extracted from the audited financial statements.
†† Safety related recalls relate to finished products which must be retrieved due to a known or possible adverse or health related impact on a patient. These include
safety related recalls which are classified as a class 1 and 2 recall by the regulator.
§ See page 43 for more on reporting boundary.
# Accounting practices for CSL Seqirus Australia product donations changed in 2020/21 to account for indirect and direct costs (versus direct only for prior years).
^ Data has been restated upwards to include CSL Seqirus contribution to the World Health Organization which was not disclosed in the 2019/20 Annual Report due
to a timing discrepancy.
^^ Data for nominated period has received limited assurance by Ernst & Young. Data collection method changed for the reporting period, see section 9, Plasma donors.
** Quality audits of suppliers undertaken by CSL’s Wuhan, China (previously Ruide) are not included in the reported totals. Processes are yet to be integrated.
Data has received limited assurance by Ernst & Young.
Reporting Boundary
Our disclosure covers the businesses and operations over which we exercise direct control and incorporates CSL Limited, CSL Behring (including CSL Plasma),
Seqirus, and global research and development (R&D). This includes our eight manufacturing facilities in Australia, China, Europe, the UK and the US as well as
R&D, sales and marketing, distribution and administration activities co-located with these facilities. Other R&D activities, sales and marketing, distribution and
administrative activities occurring away from our manufacturing facilities are also covered by this report, including the full network of donation centres, laboratories
and administration offices operated by CSL Plasma.
150
CSL Limited Annual Report 2021/22 14 Medical Glossary
Adjuvant is a substance which is intended to enhance the
body’s immune response to an antigen.
Albumin is any protein that is soluble in water and
moderately concentrated salt solutions and is coagulable
by heat. It is found in egg whites, blood, lymph, and other
tissues and fluids. In the human body, serum albumin is the
major plasma protein (approximately 60% of the total).
Antivenom (or antivenin, or antivenene) is a biological
product used in the treatment of venomous bites or stings.
Influenza commonly known as flu, is an infectious disease
of birds and mammals caused by an RNA virus of the family
Orthomyxoviridae (the influenza viruses).
Intravenous is the administration of drugs or fluids directly
into a vein.
Monoclonal antibody (mAb) is an antibody produced by a
single clone of cells. Monoclonal antibodies are a cornerstone
of immunology and are increasingly coming into use as
therapeutic agents.
Biopharmaceuticals are proteins (including antibodies),
nucleic acids (DNA, RNA or antisense oligonucleotides)
used for prophylactic or therapeutic purposes.
Cell-based (technology) for the manufacture of influenza
vaccines, is a process of growing viruses in animal cells.
Pandemic is the worldwide spread of a disease.
Pharmacovigilance is the practice of monitoring the effects
of medical drugs after they have been licensed for use,
especially in order to identify and evaluate previously
unreported adverse reactions.
Chronic inflammatory demyelinating polyneuropathy
(CIDP) is a neurological disorder which causes gradual
weakness and a loss in sensation mainly in the arms
and legs.
Coagulation is the process of clot formation.
Plasma is the yellow-coloured liquid component of blood
in which blood cells are suspended.
Primary immunodeficiency (PI) is an inherited condition
where there is an impaired immune response. It may
be in one or more aspects of the immune system.
Coronavirus is a group of RNA viruses that cause a variety
of respiratory, gastrointestinal and neurological diseases in
humans and other animals.
COVID-19 is an infectious disease caused by a newly
discovered coronavirus SARS-CoV-2.
Prophylaxis is the action of a vaccine or drug that acts
to defend against or prevent a disease.
Q fever is a bacterial infection that can cause a severe
flu-like illness. It is spread to humans by animals,
most commonly sheep, goats and cattle.
Haemophilia is a haemorrhagic cluster of diseases
occurring in two main forms:
Quadrivalent influenza vaccine is a vaccine that offers
protection against four different influenza virus strains.
Haemophilia A (classic haemophilia, factor VIII deficiency),
an X linked disorder due to deficiency of coagulation
factor VIII.
Haemophilia B (factor IX deficiency, Christmas disease),
also X linked, due to deficiency of coagulation factor IX.
Hereditary angioedema (HAE) is a rare but serious
genetic disorder caused by low levels or improper
function of a protein called C1-esterase inhibitor.
It causes swelling, particularly of the face and airways,
and abdominal cramping.
Immunoglobulins (IgG) also known as antibodies, are
proteins produced by plasma cells. They are designed
to control the body’s immune response by binding to
substances in the body that are recognised as foreign
antigens (often proteins on the surface of bacteria
or viruses).
Recombinants are proteins prepared by recombinant
technology. Procedures are used to join together
segments in a cell-free system (an environment outside
a cell organism).
Subcutaneous is the administration of drugs or fluids
into the subcutaneous tissue, which is located just below
the skin.
von Willebrand disease (vWD) is a hereditary disorder
caused by defective or deficient von Willebrand factor,
a protein involved in normal blood clotting.
151
CSL Limited Annual Report 2021/22 Corporate Directory
Share Registry
Computershare Investor Services Pty Limited
Yarra Falls
452 Johnston Street Abbotsford VIC 3067
GPO Box 2975
Melbourne VIC 3001
Enquiries within Australia: 1800 646 882
Enquiries outside Australia: +61 3 9415 4178
Investor enquiries online: Investorcentre.com/contact
Auditors
Ernst & Young
8 Exhibition Street Melbourne VIC 3000
GPO Box 67
Melbourne VIC 3001
Telephone: +61 3 9288 8000
Facsimile: +61 3 8650 7777
Registered Head Office
CSL Limited
ABN 99 051 588 348
45 Poplar Road Parkville VIC 3052
Australia
Telephone: +61 3 9389 1911
Facsimile: +61 3 9389 1434
CSL.com
Further Information
For further information about CSL and its operations, refer
to Company announcements to the Australian Securities
Exchange and our website: CSL.com
Find out more CSL.com
152
CSL Limited Annual Report 2021/22 CSL.com