BIC - 2020 Universal Registration Document

RISKS MANAGEMENT

Description and mitigation of main risk factors

Risks related to BIC’s Net Sales Regional Concentration BIC revenue streams are reliant upon a significant concentration in a few key regions, such as the United States and Latin America.

Level of risk: medium Potential impact on BIC:

Examples of Risk Mitigation:

A high level of concentration in revenue generation exposes the Company to the risk of shifting consumer demand and regulatory action in a small number of geographies. Potential business disruption due to geographic transformation as BIC looks to expand in other regions.

Continued focus on sales growth in Developing Markets. Balance the risk of concentration by deploying a portfolio approach and focusing on “Invest to grow” countries

Risk related to the execution of BIC’s transformation program “BIC 2022 – Invent the Future.” In 2019, BIC embarked on a transformation plan called “BIC 2022 – Invent the Future”. With many new innovative initiatives, there is an associated human capital and cultural risk. While the overall benefit to BIC is expected to be transformative, positive, and inclusive, potential risks of a change of this magnitude may include staff turnover, inability to acquire and retain required talent with necessary skill sets, and/or loss of institutional knowledge.

Level of risk: medium Potential impact on BIC:

Examples of Risk Mitigation:

Risk of losing institutional knowledge as well as current key competencies from potential staff departures, restructuring, and culture change within BIC. Risk of turnover within the management teams due to change in the operating model. Challenges in retaining talent due to other organizations potentially offering a more competitive employee value proposition.

Talent retention plans have been established and put in place. Talent acquisition with the relevant skillsets and experience ahead of the transformation. A centrally led talent management team created to tackle talent management risks. Active recruitment protocol leveraging educational institutions to increase our talent pool.

Risk related to M&A execution in the context of BIC’s Horizon strategic plan BIC’s “Horizon” strategic roadmap includes targeted acquisitions to strengthen BIC’s existing activities and develop into adjacent businesses.

Level of risk: medium Potential impact on BIC:

Examples of Risk Mitigation:

Execution of the transaction, including valuation and due-diligence of the targeted businesses. Integration planning and execution of the acquired companies, including failure to capture synergies.

A dedicated centrally led M&A team has been created, with professionals with extensive M&A backgrounds. A clear operating model has been established with strong governance and clear accountabilities. Due diligence and execution are supported by a disciplined process aimed at identifying and assessing value creation. Integration is governed by a strong planning process and a focus on delivering the synergies identified during the due diligence.

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• BIC GROUP - 2020 UNIVERSAL REGISTRATION DOCUMENT •