Compagnies des Alpes // 2019 Universal Registration Document

2 RISK FACTORS

Insurance – risk cover

2.7 Insurance – risk cover The Group has entered into liability insurance programmes, civil liability programmes for de facto and de jure managers and property damage insurance, and cover for corresponding business interruption with leading insurance companies. All Group companies that are more than 50%-owned by the Group, or for which the Group has responsibility for insurance, are covered by these insurance programmes. 2.7.1 CIVIL LIABILITY INSURANCE Renewed on 1 October, the civil liability policy covers operating, post-delivery, and professional liability, and contains the exclusions generally applied on the insurance market. The principal sub-limits are for criminal negligence, accidental pollution, and general contracting civil liability.

These Group programmes were the subject of a call for tenders in 2017, resulting in a signi fi cant improvement in insurance cover and limits for liability as well as property damage. In addition to these programmes, Group companies have taken out mandatory insurance policies, such as civil liability for vehicle fl eets, as well as other speci fi c policies covering areas such as construction and assistance.

The cover is supplemented with policies dedicated to Environmental Liability and Corporate O ffi cers’ Liability.

2.7.2 INSURANCE POLICY COVERING DAMAGE TO PROPERTY AND RELATED BUSINESS INTERRUPTION

Taken out on 1 October, the insurance policy covering property losses is an “all risks except” policy containing the exclusions generally applied on the insurance market, and principally covers risks of fi re, natural disasters, breakdown of machinery, and related business interruption. This programme is partly reinsured (for up to €2 million per year) by Loisirs Ré, a wholly-owned subsidiary of the Group.

In conjunction with the sites and insurers, the Group revises and improves its prevention policy on the basis of prevention manuals enhanced every year through feedback and regular visits by insurance brokers who make recommendations which are monitored half-yearly.

2.8 Internal control procedures To constantly improve its internal control and risk management system, Compagnie des Alpes looks to the internal control and risk management procedures reference framework published by the AMF in June 2010. For this report, CDA has used the implementation guide intended for small and mid-cap companies, published in July 2010.

The AMF’s reference framework stresses that internal control and risk management procedures should be used in a complementary way to control the Company’s activities.

2.8.1 INTERNAL CONTROL PROCEDURES Internal control is a set of procedures implemented by the Group’s Executive Management, senior executives, and employees. It is designed to provide reasonable assurance that the following objectives are being met: l compliance with the current laws and regulations; l the application of the Executive Management’s instructions and guidance; l the completion and optimisation of operations, in particular those

Internal control is one element of the Group’s overall management system, as it helps to ensure that: l the Company’s activities are controlled, its operations are e ff ective and its resources are used e ffi ciently; l operational risks linked to the various operational processes, in particular risks of error or fraud, are managed. As is the case with any control system, the system the Group employs cannot provide an absolute guarantee that the risks identified have been eliminated entirely or are completely under control. It is intended to reduce the likelihood of these risks arising through the implementation of appropriate action and prevention plans. The Executive Management of the CDA Group is responsible for implementing and monitoring the e ff ectiveness of the internal control procedures employed by the Legal A ff airs, Audit and Internal Control Department, on the Executive Management’s initiative, for the holding

helping to protect the Group’s assets; l the reliability of fi nancial information.

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Compagnie des Alpes I 2019 Universal registration document