AIRBUS - 2020 Universal Registration Document
4. Corporate Governance / 4.1 Management and Control
“– 4.1.3 Enterprise Risk Management System”. Please refer to Annex E of the Board Rules for a complete list of responsibilities of the Audit Committee. The Chairman of the Board of Directors and the CEO are invited to attend meetings of the Audit Committee. The CFO and the Head Accounting Record to Report are requested to attend meetings to present management proposals and to answer questions. Furthermore, the Head of Corporate Audit & Forensic and the Chief Ethics and Compliance Officer are requested to report to the Audit Committee on a regular basis. In 2020, this Committee met five times with an attendance rate of 100%. It fully performed all of the duties and discussed all of the items described above. In particular, it performed reviews of internal controls, corporate audit (including major findings and audit plan for 2020) and accounts ( i.e. 2019 full year accounts, 2020 Q1, H1 and Q3 accounts, 2020 forecasts, specific provisions) and independence of external auditors. In addition, regular ERM and Legal & Compliance updates were presented to the Audit Committee and discussed in meetings. To reinforce the role and involvement of the Board of Directors on sustainability-related topics, the remit of the former Ethics & Compliance Committee established in 2017 was extended to sustainability matters in July 2020. The Committee was renamed Ethics, Compliance and Sustainability Committee (“ ECSC ”) and the Board Rules have been amended accordingly. Pursuant to the revisedBoardRules, themainmission of the EC&SCommittee is to assist the Board of Directors in overseeing the Company’s culture and commitment to ethical business, integrity and sustainability. The ECSC is empowered to monitor the Company’s Ethics & Compliance programme, organisation and framework in order to make sure that the Company’s Ethics & Compliance governance is effective (including all associated internal policies, procedures and controls). This includes the areas of money laundering and terrorist financing, fraud, bribery and corruption, trade sanctions and export control, data privacy, procurement and supply chain compliance and anti-competitive practices. The ECSC is also empowered to oversee the Company’s sustainability strategy and effective governance and ensure that sustainability related topics are taken into account in the Company’s objectives and strategy. The ECSC makes recommendations to the Board of Directors and its Committees on all Ethics, Compliance or Sustainability- related matters and is responsible for providing to the Audit Committee any necessary disclosures on issues or alleged ethical and compliance breaches that are f inancial and accounting-related. The ECSCmaintains a reporting line with the Chief Ethics & Compliance Officer, who is requested to provide periodic reports on its activities. The Chairman of the Audit Committee and the Chairman of the RNGC are members of the ECSC. Unless otherwise decided by the ECSC, the CEO and the Chairman of the Board of Directors are invited to attend the meetings. From time to time, independent external experts are also invited to attend ECSC meetings. The ECSC is required to meet at least four times a year. In 2020, the ECSC met in total four times with an average attendance rate of 94%. All of the above described items were discussed b) The Ethics, Compliance and Sustainability Committee
The Board Members notably valued good Board meeting preparation, suitable time allocation to agenda items as well as satisfactory contributions of the Board Committees, elements which greatly contribute to the Board of Directors’ efficiency. In addition, the Board of Directors highlighted its collegial, cooperative and effective functioning as a team. The Board of Directors expects this trend to continue. Following the last Board of Directors evaluation, the frequency of participation of Top Management members to Board meetings has significantly increased. The Board of Directors has spent additional time on strategy and Top Management succession planning, as well as on other important matters for which discussions would need to be continued such as digitalisation/industrialisation, cybersecurity/ IT, innovation, employee engagement, competitive environment and market positioning, sustainability & environment and safety. The remit of the Ethics & Compliance Committee was enlarged in 2020 to include environment and sustainability matters. The Directors underlined that the Board of Directors should in addition spend further dedicated time on geopolitical developments, business model evolution and portfolio management. In addition, Executive Committee succession planning is expected to be more extensively discussed by the Remuneration, Nomination, Governance Committee and Board. Finally, the Board Members expressed their overall satisfaction with regards to the Board of Directors composition, selection and nomination process and highlighted the necessity to continue with the process of the staggering board principle in order to further develop the diversity of gender within the Board of Directors. The Audit Committee has five (5) Members and is chaired by an Independent Director who is not the Chair of the Board of Directors or a current or former Executive Director of the Company. The Chair of the Audit Committee shall be, and the other members of the Audit Committee may be, financial experts with relevant knowledge and experience of financial administration and accounting for listed companies or other large legal entities. Pursuant to the Board Rules, the Audi t Commi t tee, which is required to meet at least four times a year, makes recommendations to the Board of Directors on the approval of the annual Financial Statements and the interim accounts (Q1, H1, Q3), as well as the appointment of external auditors and the determination of their remuneration. Moreover, the Audit Committee has responsibility for verifying and making recommendations to the effect that the internal and external audit activities are correctly directed, that internal controls are duly exercised and that these matters are given due importance at meetings of the Board of Directors. Thus, it discusses with the auditors their audit programme and the results of the audit of the Financial Statements, and it monitors the adequacy of the Company’s internal controls, accounting policies and financial reporting. It also oversees the operation of the Company’s ERM system and keeps a strong link to the Ethics, Compliance and Sustainability Committee. For further details in this regard, see 4.1.1.2 Board Committees a) The Audit Committee
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Airbus / Registration Document 2020
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