Simon 2018 Proxy Statement

ASSESSMENT OF COMPENSATION-RELATED RISKS

Our senior management team conducts an ongoing assessment of the risks related to our compensation policies and practices. This team reviews and discusses the various design features and characteristics of our Company-wide compensation policies and programs. The team also considers the elements of our compensation program for our senior executives including the performance measures used for the Annual Cash Incentive Compensation program and our long-term incentive programs. Senior management obtains and evaluates data from a REIT peer group reflecting a comparison of compensation practices and pay levels for comparable positions within that group to assess the competitiveness of our compensation levels. The Committee is responsible for overseeing the risks relating to compensation policies and practices affecting senior management on an ongoing basis. In performing this responsibility, the Committee utilizes the services of its independent compensation consultant to obtain advice and assistance in the design and implementation of incentive compensation programs for our executives. The consultant does no work for management, unless requested by the Chairman of the Committee. In reviewing whether our compensation policies and practices encourage excessive risk-taking, the Committee also considers senior management’s assessment described above. We believe the following factors reduce the likelihood that our compensation policies and practices would encourage excessive risk-taking: • Our compensation mix is generally designed in large part to reward long-term performance and is balanced among (i) fixed cash components, (ii) incentives that reward improvements in total Company performance and business unit performance, (iii) components measured by individual performance, and (iv) performance-based incentive opportunities that may be realized in the future. • Our policies and programs are intended to encourage retention of our executives so that they can focus on achieving long-term objectives. • Our overall compensation is maintained at levels that are competitive with the market. • Our Annual Cash Incentive Compensation is weighted based on the achievement of several different financial and operational performance measures; the Committee has ultimate oversight in determining the Annual Cash Incentive Compensation allocation, thereby mitigating the risk that any one measure can dominate the payouts based on any formula. • Our NEO 2015-2017 and 2016-2018 Performance-Based LTIP Program uses both absolute and relative TSR performance measures over three-year performance periods. • Our NEO 2015-2017 and 2016-2018 Performance-Based LTIP Program includes a two-year service-based vesting requirement after the conclusion of the three-year performance period. • Awards under David Simon’s 2011 CEO Retention Agreement are subject to performance conditions and post-earning vesting requirements. The awards were only earned if performance measures were achieved. • Executive officers are subject to minimum stock ownership guidelines , equity award multi-year vesting requirements and limitations on trading our securities, including prohibitions on hedging our securities, under our Insider Trading Policy. • The Committee has discretion to decrease incentive performance targets and payouts when it determines that such

adjustments would be in the best interests of the Company and our shareholders. • All LTIP unit awards contain ‘‘double trigger’’ change in control provisions.

• All award agreements we have entered into with executive officers contain clawback provisions permitting the Company to recoup compensation tied to the achievement of financial targets if the compensation would not have been earned based on restated financial results. Based on the foregoing, the Committee believes that our compensation policies and programs are not reasonably likely to have a material adverse effect on the Company.

42 SIMON PROPERTY GROUP 2018 PROXY STATEMENT