5 . NOTE 11. Equity – Earnings per share 11.1. Share capital and additional paid in capital Share capital consists of 557,672,360  shares with a par value of €0.20 at 31   December 2021 following the exercise of subscription options for 52,397 shares, the issue of 5,327 shares for the employee shareholding plan in the UK, 743,056  free shares and the cancellation of 3,000,000 shares. Share capital consists of 559,871,580  shares with a par value of €0.20 at 31   December 2020 following the exercise of subscription options for 465,796  shares, the issue of 452,979   shares for the employee shareholding plan and 835,600 free shares. Share capital consisted of 558,117,205 shares with a par value of €0.20 at 31  December 2019, following the exercise of subscription options for 785,408 shares the issue of 8 shares for the employee shareholding plan, 706,262 free shares and the cancellation of 3,771,125 shares. 11.2. Treasury shares Accounting principles Treasury shares are recorded at acquisition cost and deducted from equity. Capital gains/losses on disposal of these items net of tax are charged directly to equity and do not contribute to profit for the financial year. a) 2021 The change in the number of shares in 2021 was as follows: In shares Share capital Treasury shares Common shares outstanding At 01.01.2021 559,871,580 - 559,871,580 Shares cancelled -3,000,000 3,000,000 - Options and free shares exercised 800,780 - 800,780 Treasury shares purchased - -25,260,000 -25,260,000 AT 31.12.2021 557,672,360 -22,260,000 535,412,360 The change in treasury shares in 2021 was as follows: In shares Buyback programme Allocated to free-share plans Total € mill ions At 01.01.2021 - - - - Shares cancelled -3,000,000 - -3,000,000 -1,104.8 Options and free shares exercised - - - - Treasury shares purchased 25,260,000 - 25,260,000 10,045.0 AT 31.12.2 021 22,260,000 - 22,260,000 8,940.2 b) 2020 The change in the number of shares in 2020 was as follows: In shares Share capital Treasury shares Common shares outstanding At 01.01.2020 558,117,205 - 558,117,205 Shares cancelled - - - Options and free shares exercised 1,754,375 - 1,754,375 Treasury shares purchased - - - AT 31.12.2020 559,871,580 - 559,871,580 330 L ’ ORÉAL I UNIVERSAL REGISTRATION DOCUMENT 2021 2021 CONSOLIDATED FINANCIAL STATEMENTS Notes to the consolidated financial statements