Eurazeo / 2018 Registration document

GOVERNANCE Risk management, internal control and main risk factors

Risk management, internal control and main risk 3.4 factors

3.4.1

RISK MANAGEMENT AND

Eurazeo's core business consists in the acquisition of investments, mostly in unlisted companies. In a bid to create value, Eurazeo defines and pursues a certain number of strategic, financial and operating objectives. The occurrence of certain risks could impact its ability to achieve its objectives. In the same way as other companies, Eurazeo operates in an environment intrinsically subject to uncertainty, where risk-taking is inseparable from the search for opportunities and the desire to grow the Company. It is therefore important for Eurazeo to identify, prevent and mitigate the impact of the main risks likely to threaten the achievement of its objectives, by designing and implementing appropriate internal control and risk management systems. Under the responsibility of the Executive Board, these systems: are incorporated into the economic model and business processes • specific to the organization, in order to contribute positively to the conduct and management of its different activities and provide a competitive edge for the Company, particularly by improving decision-making; and are part of a continuous improvement process, mobilizing • Company employees around a shared vision of the main risks. While being as well implemented and designed as possible, the internal control and risk management systems cannot provide an absolute guarantee that the Company's objectives will be achieved. The systems are generally limited by human factors: decision-making relies on people and the exercise of their judgment. The following two sections present a summary of: the characteristics of the internal control and risk management (i) systems implemented by Eurazeo; and the specific aspects of the main risks to which the Company is (ii) exposed. The specific aspects of the main risks are presented based on the following principles: the information presented does not claim to be comprehensive • (unknown risks, risks poorly or not identified, etc.) and does not cover all the risks to which the Company may be exposed in the conduct of its activities. The analysis performed by the Company focuses on those risks considered capable of calling into question business continuity or that could have a material negative impact on its activity, financial position or results (financial impact, particularly on Net Asset Value) and/or on the development of the Company (particularly impact on its reputation and the human factor). To the best of Eurazeo’s knowledge, there are no material risks other than those presented. Information on financial risks is also presented pursuant to the French Commercial Code (Article L. 225-100-1); the description only provides an overview of risks at a point in time; • Eurazeo's legitimate concerns regarding the possible consequence • of disclosing certain information have been taken into account, while respecting the rules governing the communication of information to the market and investors.

INTERNAL CONTROL SYSTEMS The risk management and internal control systems contribute in a complementary manner to controlling the activities of the Company: the risk management system seeks to identify and analyze the • main risks to which the Company is exposed. Identified risks likely to exceed the acceptable limits set by the Company are mitigated and, when required, action plans are prepared. These action plans provide for the implementation of controls, the transfer of the financial consequences (insurance mechanisms or equivalent) or a change to the organizational structure; the internal control system relies on the risk management system • to identify the main risks to be controlled. In the same way as the general principles of the AMF framework, Eurazeo's internal control system seeks to ensure: compliance with legislation and regulations, application of the instructions and strategic direction set by the Executive Board, the smooth running of the Company's internal processes, particularly those contributing to the security of its assets and the reliability of financial information. These systems rely on processes (3.4.1.1), key players (3.4.1.2) and an environment promoting honest and ethical behavior (3.4.1.3), which are presented successively below. In addition, a specific section is devoted to internal controls covering the preparation and processing of financial information (3.4.1.4). The systems presented (functioning as of December 31, 2018) cover all transactions performed within a scope comprising Eurazeo SE and its subsidiaries housing the different investment divisions (1) , the Luxembourg, Shanghai and New York offices and the investment vehicles directly controlled by each of these companies.

3

Except Idinvest, acquired in 2018, which has its own systems. (1)

Eurazeo

189

2018 Registration Document