BIC - 2019 Universal Registration Document

CORPORATE GOVERNANCE

Corporate Officers’ compensation

CORPORATE OFFICERS’ COMPENSATION 4.2.

4.2.1

COMPENSATION POLICY FOR THE CHAIRMAN, CHIEF EXECUTIVE OFFICER AND EXECUTIVE VICE-PRESIDENTS OF SOCIÉTÉ BIC FOR 2020

Comparability All of the components are determined in the context of the local and international markets where BIC competes for talent both in our industry and in general. BIC refers to benchmarks in every country where we have team members such that remuneration designs are competitive. Internal Consistency and Proportionality The same overall principles apply for all team members. Within the overall policy, rewards are differentiated to reflect the level of responsibilities, individual and collective performance, team member potential and differing competitive market practices. At the most senior levels the proportion of compensation at risk under the bonus and long-term incentive plans may be the most significant element, aligning team member interests with those of shareholders. Understandability of the Rules Compensation policies are clearly communicated to executives, both in terms of their structure and the alignment with BIC’s strategy and business objectives. the CEO and Executive Vice-President and Chief Financial Officer To ensure comparability that matches BIC’s international business, BIC has engaged WillisTowersWatson a leading global compensation consultancy to build special peer group surveys in France and in the United States, the 2 markets in which BIC employs the majority of senior executives. For the peer group surveys in France and the United States a panel of companies is proposed, reviewed by the Remuneration Committee and adopted by the Board. The comparison panels are based on direct business competitors and other companies with which BIC competes for senior executive talent. Generally, there is stability in the panels to allow effective and consistent comparisons of compensation competitiveness from one year to the next. The peer group panels are as follows: France: Accor Hotels, Alstom, Bureau Veritas, Carrefour, ● EssilorLuxottica, L’Oréal, LVMH, Pernod Ricard, Safran, Schneider Electric, SEB, Tarkett, Thales, Unibail-Rodamco, Valeo, Vallourec; Method of determining competitiveness for 4.2.1.1.2

4.2.1.1

General principles governing

compensation The compensation policy for company officers is determined by the Board of Directors upon the recommendation of the Remuneration Committee taking into account the principles and criteria defined in the AFEP-MEDEF Code of Corporate Governance. The Board of Directors ensures that these are also directly aligned with the Company’s global strategy and shareholders’ interests to support the Company’s performance and competitiveness in the medium and the long term. Compensation principles are in line with the AFEP-MEDEF Code except those recommendations not applied as stated in section 4.1.2.7 Summary table of the implementation of the AFEP-MEDEF Code. 4.2.1.1.1 The compensation policy for Corporate Officers of SOCIÉTÉ BIC is based on the same Total Rewards strategy that applies for all BIC Group team members and the framework criteria set out in the Code of Corporate Governance: comprehensiveness, balance between the compensation components, comparability, consistency, understandability of the rules and proportionality. Comprehensive and Balanced The overall compensation package is based on four components base salary levels are to be competitive for the location, level 1. and role as a foundation to attract and retain; bonus designs and levels motivate and reward performance 2. for the year and should be aligned with shareholders’ interests and contribute to sustainable growth and profitability. Performance criteria should be clear and aligned with short and longer-term objectives; for key team members there is additional compensation at 3. risk in the form of longer-term incentives that are directly tied to the business results on key performance metrics over a number of years. They are also an element to attract, motivate and retain key talent; benefits terms are integrated with local social benefits, with 4. an overall focus on providing short-term protection, i.e., life and disability insurance, and, as appropriate health care, plus savings accumulation/retirement offerings where this is market practice. Principles of the Compensation Policy

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• BIC GROUP - 2019 UNIVERSAL REGISTRATION DOCUMENT •