EDF / 2020 Universal Registration Document

2 RISK FACTORS AND CONTROL FRAMEWORK Risks to which the Group is exposed implementing an external recruitment policy, targeting the skills of tomorrow that are not available on the internal job market – for which the EDF group is one of the leading recruiters in France – and (ii) an inclusive employer approach favouring sourcing via work-study and end-of-study internships, with a specific focus on candidates from zones de revitalisation rurale (ZRZ) (rural revitalisation zones) and quartiers politiques de la ville (QPV) (urban political districts); enhancing external career paths as a lever for acquiring new skills (PAME (2) , CCE (3) ) and “win-win-win” career ends (employee, company, territory) through senior skills sponsorships; nurturing a sustained social dialogue, in order to ensure that the trade union organisations have a good understanding of the employment and skills policies. Obtaining experience may require several years and sufficient coverage for the transfer of knowledge and experience. In 2020, as part of the EXCELL plan in particular, the Group launched a system of knowledge management which should make it possible to secure skills in the nuclear field. The EDF group considers the dynamic matching of skills to needs to be a major challenge and therefore implements the appropriate measures to facilitate change. However, it cannot guarantee that the measures taken will always be sufficient or on satisfactory terms, which could have an impact on its business, financial position and reputation as an employer. 3D – Ability to ensure long-term social commitments. Criticality in view of the control actions undertaken: Intermediate. The pension plans applicable in the various countries in which the Group operates involve long-term commitments to pay benefits to the Group’s employees (see note 16 of the appendix to the consolidated financial statements for the fiscal year ended 31 December 2020). In France, in addition to these pension commitments, the Group also owes obligations for post-employment benefits and long-term benefits for employees currently in service. The ongoing pension reform in France may have an impact on the Group’s commitments. At 31 December 2020, the average duration of employee benefits commitments was 20.6 years in France and 23.5 years in the United Kingdom. In order to cover these commitments, the Group has set up pension funds in the United Kingdom, where coverage of commitments is a regulatory obligation, and outsourced funds in France, which provide partial coverage of commitments. The amounts of these commitments, the provisions booked, the outsourced funds or pension funds set up and the additional contributions required to make up insufficient funding are calculated based on certain actuarial assumptions, including a discount rate subject to adjustment depending on market conditions and, in the event of any employee-related commitments in France, on the rules governing retirement benefits paid out by the general retirement scheme, and amounts owed by the Group. These assumptions and rules may be adjusted in the future, which could increase the Group’s current commitments for pensions and other employee benefits and, therefore, require a corresponding increase in provisions. Furthermore, if the value of pension funds in the UK proves insufficient to meet the corresponding commitments, primarily due to calculation assumptions or developments in the financial markets, the Group may be obliged to make additional contributions to the relevant funds, which may have an adverse impact on its financial position. The Group may be required to meet significant commitments related to pensions and other employee benefits.

In addition, new low-carbon energy solutions may induce new societal questions (new intrusive technologies, land rights-of-way, new conflicts related to the use of water or scarce resources, etc.). New legislative or regulatory changes brought about by climate change could also have a negative impact on EDF’s business and lead to new legal or compliance risks. The Group may also have to deal with the emergence of new technologies or disruptive solutions that are part of the efforts to meet the transition objectives. Such situations could make it more difficult to carry out these transformations and achieve the desired objectives. They could directly or indirectly affect the Group’s business volumes, margins, asset value, financial position, reputation or prospects. Risk summaries and mapping In 2019, a summary on climate change and its impacts on EDF was presented to EDF’s Scientific Council (see section 3.1.3.2 “Implementation of Task Force on Climate-related Financial Disclosures (TCFD) recommendations”). A Group-wide climate risk mapping of all physical and transition risks was also established following the recommendations of the TCFD (Task Force for Climate Financial Disclosures, see section 3.9.4 “Summary of EDF group climate risks”). Climate risks have been identified and assessed using the Group’s general risk mapping method. In 2020, this mapping of climate risks, based in particular on the adaptation plans of the operating entities and on the report to the Scientific Co/uncil, has led to a “resilience” action plan mobilising the Group at both corporate and entity levels. It was examined by the Audit Committee. A detailed description of this risk mapping is given in section 3.9.4. 3C – Adaptation of employees’ skills. Skill adaptation and development may be insufficient in view of the Group’s transformation, business line requirements and new organisational and working methods. Criticality in view of the control actions undertaken: Intermediate. In an environment impacted by the energy and digital transitions, the scope of the Group’s activities is changing. New business lines are developing, working methods are changing (empowerment, collective intelligence, operating on project platforms, increased distance working, etc.). Although the action plans implemented to date have made it possible to control the evolution of the workforce and the adaptation of skills, there is a continuing risk of skills mismatch in the coming years, in this context of transformation. Risk management is based on matching skills to short-, medium- and long-term needs, on supporting the employability of employees and on managing internal mobility more fluidly. In this regard, the actions undertaken since 2018 relate to: anticipating the future, by analysing forecast needs in terms of resources and skills in the short/medium term (GPEC (1) ) and the longer term (Prospective); pursuing an ambitious approach to skills development through traditional training and the development of professional skills development initiatives; developing the employability of employees in order to facilitate their professional development and changes of profession; creating the conditions for internal mobility within the Group;

(1) GPEC: Employment and Career Planning. (2) PAME: External Mobility Guidance. (3) CCE: Company Creation Leave.

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EDF - UNIVERSAL REGISTRATION DOCUMENT 2020

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