Invitation to our General Meeting 2022

The remuneration policy applicable to the corporate officers is described in its entirety in the 2021 Universal Registration Document on pages 199 to 212. It is in line, in terms of principles and structure, with the policy approved by the General Meeting of May 4, 2021, while taking into account evolutions resulting from the changes in governance decided in the context of the succession of Mr Benoît Potier in the function of Chief Executive Officer.

1. REMUNERATION POLICY APPLICABLE TO COMPANY OFFICERS

The remuneration policy applicable to Company Officers subject to the approval of the General Meeting breaks down as follows:

• the remuneration policy of the Chairman and Chief Executive Officer (concerning Mr Benoît Potier for the period running from January 1, 2022, to May 31, 2022);
• the remuneration policy of the Chief Executive Officer (concerning Mr François Jackow with effect from June 1, 2022);
• the remuneration policy of the Chairman of the Board of Directors under a separated governance mode (concerning Mr Benoît Potier beginning on June 1, 2022).

1.1. COMMON PRINCIPLES FOR EXECUTIVE OFFICERS

In keeping with the Group’s practices, the remuneration policy applicable to Executive Officers provides for a proportionate balance between the three components of the total annual remuneration (the fixed remuneration, the variable remuneration and the long-term incentives (or “LTI”)).

In principle, the fixed remuneration represents approximately 25%, the variable remuneration approximately 35% and the LTI approximately 40% of the target total annual remuneration. Thus, the elements subject to performance conditions represent in principle approximately 75% of this total target remuneration. Due to the cessation of his term of office as Chief Executive Officer, Mr Benoît Potier will not be awarded LTI for 2022.

The fixed remuneration is determined on the basis of the level of responsibility, the experience in the executive management duties and market practices.

The principles applicable to the annual variable remuneration are unchanged:

• The variable part continues to be expressed as a target variable remuneration with a maximum.
• Concerning the weighting of the criteria adopted, a greater relative weight is given to the quantifiable criteria as compared to the qualitative criteria.
• The rate of achievement of the objectives for the variable remuneration expressed as a percentage of the fixed remuneration and as a percentage of the target variable remuneration allocated to this criterion, will be made public ex post.
• The quantifiable elements of the annual variable remuneration include (i) a criterion of an increase in the recurring net earnings excluding currency impact, per share (“recurring EPS”) which makes it possible to take into account all the items in the income statement and (ii) a criterion of comparable growth in consolidated revenue which in turn reflects the momentum of the activity.
• The qualitative elements of the annual variable remuneration continue to be based, (i) as to two-thirds, on several categories or sub-categories of objectives which are defined each year and, (ii) as to one-third, on an assessment of the individual performance. They incorporate the pursuit of objectives related to Safety, Sustainable Development relating to the ESG Objectives announced by the Group on March 23, 2021 (“ACT for a sustainable future”), Human Resources and preparation of the management succession plans.

The LTI grants for the 2022 fiscal year:

• remain subject to the proration principle on the basis of the actual presence of the Executive Officer;
• are not made at the time of departure of the Executive Officer;
• remain subject to demanding performance conditions calculated over a period of three years:
  1. the ROCE (for 50%) with an objective set within the trajectory of the ROCE target announced by the Company that is maintained at more than 10% for 2023-2024;
  2. the rate of Total Shareholder Return (TSR) (for 40%) calculated (i) for half, on the basis of an absolute TSR (“AL TSR”) in accordance with historic performances and (ii) for half, on the basis of a relative TSR (“B TSR”) compared to the average of the CAC 40 TSR;
  3. the Group’s Climate Objectives (for 10%) set on the basis of the change in the Group’s absolute CO₂ emissions over the period 2022-2024 in line with the objective for a shift in 2025 in accordance with the Climate Objectives announced by the Group on March 23, 2021 (“ACT” for a sustainable future).

Moreover, the Executive Officers benefit from other benefits attached to the performance of the term of office (see below).