AIRBUS - 2020 Universal Registration Document

4. Corporate Governance / 4.1 Management and Control

performed talent reviews. The impact of the COVID-19 crisis on the remuneration structure was also addressed and appropriate actions taken accordingly. Due to the COVID-19 crisis context, no off-site Board meeting was held in 2020, preventing the Board of Directors from continuing to visit industrial sites. More generally, the Board of Directors met virtually several times due to confinement measures and travel restrictions nevertheless without hampering the efficiency of Board of Directors functioning. Board Evaluation 2020 As a matter of principle, the Board of Directors implements a continuous evaluation process based on a three-year cycle. As part of this process, every three years, a formal evaluation of the functioning of the Board of Directors and its Committees is conducted with the assistance of a third-party expert. In the year succeeding such an outside evaluation, the Board of Directors performs a self-evaluation and focuses on the implementation of the improvement action plan resulting from the third party assessment. In the intervening second year, the General Counsel, being also the Secretary of the Board of Directors, issues a questionnaire and consults with Board Members to establish an internal evaluation which is then discussed with Board Members. The year 2020 would have been the start of a new cycle, but it was decided to add to the previous cycle one exceptional year without the support of a third party expert due to estimated limited added value considering the recent changes in the Board of Directors composition – new Chairman and two new Directors and the restrictions imposed by COVID-19. Therefore in November 2020 an internal evaluation was carried out by the Board of Directors based on an extensive questionnaire issued by the General Counsel. The questionnaire primarily covered governance and Board of Directors topics, Board of Directors and Committees functioning, Board of Directors composition and selection process, dynamic between Board of Directors and Management and amongst Board Members, Board of Directors decision-making process, Committees’ contributions and Board Secretary Support. To take current events into account, a specific COVID-19 Section was added. In its 2020 internal evaluation, the Board of Directors confirmed overall satisfaction with the progress made since the Board of Directors evaluation of last year and the implementation of the actions carried forward from the “ Improvement Action Plan ” recommended by Heidrick & Struggles, following the last formal evaluation. Whereas during 2019 an almost entirely new management team was put in place making a remarkably encouraging start in its interactions with the Board of Directors, in 2020 the newly nominated Chairman had to cope from the beginning with the enormous and far reaching impacts the COVID-19 pandemic was imposing on the world and on the aeronautics industry specifically. In this difficult context, the Company’s management of the COVID-19 crisis was seen as appropriate. In addition, the Company’s governance, dynamic and performance is viewed as satisfactory, with excellent relationships between the Management, the Chairman and the Board Members. The resulting limited interpersonal interactions between the Board Members did not hamper an efficient decision-making but impacted a smoother familiarisation between the new Board Members.

For Commercial Aircraft, this comprised inter alia regular reviews of market, sales, supply chain and productions status as well as decisions taken in relation to Human Capital, including the Company resizing measures imposed by the COVID-19 crisis. For Defence and Space, it concerned notably the progress on the Eurodrone and the Future Combat Air System programmes and the challenges faced on the Space side. For the Helicopters business, the Board of Directors focused its review on the overall market situation that contracted in the COVID-19 crisis context and the support and services activities that remained strong despite the circumstances. The Board of Directors dedicated a full session in 2020 to the review of key aspects of the Company’s strategy, including the announced zero-emission ight ambition by 2035 as well as additional time during other sessions to specific strategy opportunities and projects. Moreover, the Board of Directors reviewed the Company’s financial results and forecasts and maintained an emphasis on both Enterprise Risk Management (“ ERM ”) and internal control. A particular focus was also made on cybersecurity and sustainability initiatives, notably with the decision made by the Board of Directors in July 2020 to extend the remit of the former Ethics & Compliance Committee to sustainability matters, encompassing Environment (including climate change), Human Rights and Inclusion, Safety & Quality as well as Business Integrity (see paragraph 4.1.3 for further details). Following the settlements reached with the French, UK and US authorities in January 2020 in relation to the Serious Fraud Office / Parquet National Financier / US Department of Justice / US Department of State investigations, the Board of Directors and its Ethics, Compliance and Sustainability Committee remained fully committed and provided full support throughout the year to the post-settlement activities. The Board of Directors pays close attention to the Company’s active engagement with its shareholders to ensure that its approach to governance, compliance and sustainability are well understood and continues to re ect shareholders’ expectations. The conclusion in 2020 of these investigations demonstrated Airbus’ strong motivation to cooperate with the relevant authorities and to implement stronger reporting and compliance standards to prevent a re-occurrence of such events. Despite recognising the improvements made to the Company’s reporting and compliance standards, some shareholders opposed the proposals relating to the Board’s discharge at the 2020 AGM. Opposing shareholders voiced concern over Airbus’ previous practices. Their vote should not be interpreted as an opposition to Airbus’ strengthened governance and compliance standards. The Board of Directors also reviewed and discussed other topics of significant importance to the Company such as the measures taken to mitigate a no-deal Brexit situation, the potential impact of the US elections, the reciprocal application of tariffs on commercial aircraft being imported to and from the US and crisis management matters. Furthermore, the Board of Directors played a key role in the succession planning of both the Chairman and Board Members in preparation for the appointment of René Obermann as Chairman of the Board in replacement of Denis Ranque and of the appointment of two newNon-Executive Directors, Mark Dunkerley and Stephan Gemkow in April 2020. The Board of Directors also worked on the top management succession planning and

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Airbus / Registration Document 2020