Simon 2018 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS

No LTIP units were earned under our 2015-2017 LTIP Program because the Company’s absolute and relative total shareholder return (‘‘TSR’’) did not reach the levels required for any payout.

OBJECTIVES OF OUR EXECUTIVE COMPENSATION PROGRAM Our executive compensation program is designed to accomplish the following objectives: • Retain a group of highly-experienced executives who have worked together as a team for a long period of time and who make major contributions to our success. • Attract other highly qualified executives to strengthen that team and facilitate succession planning. • Motivate executives to contribute to the achievement of corporate and business unit goals as well as individual goals. • Emphasize equity-based incentives with long-term performance measurement periods and vesting conditions. • Align interests of executives with shareholders by linking payouts to performance measures that promote the creation of long-term shareholder value.

SHAREHOLDER/GOVERNANCE FRIENDLY ASPECTS OF OUR CURRENT EXECUTIVE COMPENSATION PROGRAM

WHAT WE DO

WHAT WE DON’T DO

Pay for Performance—Annual Cash Incentive Program. Heavy emphasis on performance-based compensation. Annual Cash Incentive Compensation is paid only if certain FFO targets are Pay for Performance—LTIP Plan. Our 2015-2017 and 2016-2018 LTIP Programs are 100% performance-based and are tied to rigorous absolute (weighted 20%) and relative (weighted • A significant majority of our NEO’s 2017 compensation was performance-based. In 2017, 73.7% of our CEO’s pay mix and 62.3% of our other NEOs’ actual pay mix were variable and performance-based. • Awards granted to our CEO under our 2011 CEO Retention Agreement (as defined in ‘‘Employment Agreement with David Simon’’) are based on FFO performance in addition to service Post-Performance Time-Based Vesting on Earned LTIP Units. LTIP units are earned based on specific performance criteria. The 2015-2017 LTIP Program and 2016-2018 LTIP Program are measured over a three-year period. Once any units are earned under these programs, executives must remain with the Company to obtain the units over a two-year vesting period. Robust Stock Ownership Guidelines. Stock ownership guidelines for our CEO and other NEOs are 6x and 3x base salary, respectively. In addition, the CEO and other NEOs must retain shares until he or she retires, dies, becomes disabled or is no longer our employee. All non-employee directors must hold common stock while they serve as directors. Double Trigger Equity Acceleration Upon a Change in Control. Beginning with 2013 grants and included in our 2011 CEO Retention Agreement. During 2014, we amended earlier equity grants to include similar double trigger provisions. Clawback Policy. Applies in the event of any material restatement of the Company’s financials beginning in 2012, whether or not fraud/misconduct is involved. Independent Compensation Consultant. The Committee has utilized an independent compensation consulting firm, Semler Brossy, since the end of 2011. Compensation Risk Assessments. Conducted annually to evaluate whether the executive compensation program encourages excessively risky behaviors. achieved. 80%) stock price performance goals. requirements.

No Annual Grants of Time-Vested Restricted Stock or Options to our NEOs . We amended our stock incentive plan to require that awards of performance units, including LTIP units, must be conditional upon attainment of performance goals, unless shareholders vote to approve non-performance-based units. No Excessive Perquisites and No Gross-Ups. No supplemental executive retirement plans, company cars, club memberships or other significant perquisites. We also have never had any arrangements requiring us to gross-up compensation to cover taxes owed by the executives, including excise taxes payable by the executive in No Excessive Retirement and Health Benefits. The Company has never had a traditional defined benefit plan. No Hedging or Pledging of Company Stock. Our NEOs and directors are prohibited from engaging in any hedging or pledging of connection with a change in control.

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SIMON PROPERTY GROUP 2018 PROXY STATEMENT 25