Eurazeo / 2019 Universal Registration Document

Risk management Risk factors

IMAGE AND COMPLIANCERISKS 4.2.2 Ethical responsibilitylinked to portfoliocompanyactivity 4.2.2.1 HIGH Risk that thebusiness of one or several portfolio companies harmscustomers, employees or a community (psychological and/or physical harm) due to shortcomings likely to offend consumers andthe population.

Some portfolio companies operate in sectorswhereconsumers and the generalpublicare particularlymindfulof the way thathealthandsafetyissues are taken into account by organizations.Thiscan includeactivitieslinked to education, early childhood,medicaltreatment, food, etc. For this type of portfolio company, incidents relating to the health and/or safetyof customers,employeesand/or localcommunities are likely to receive very negative media coverage which could damage the image of the portfolio company andEurazeo. Regardless ofsector,portfolio companies ensurethey implement effective programsto comply with regulatory standards and industry best practices in terms ofhealth andsafety. From the acquisition phase, Eurazeo performs in-depth due diligence on societal, health andsafetyrisks in relation to the target’s business activities;theserisks andthe associatedaction plansare subject to post-acquisition follow-up. Potentialeffects Physical or psychological harm to portfolio companies’ stakeholders • (customers, employees, communities) Damage to the reputation and imageof the portfolio company • and Eurazeo Examples of risk mitigation measures Inclusion ofaspects linked to societal, health and safetyimpactsduring • acquisition due diligence Post-acquisition follow-up of action plans • Stakeholder dialog • Crisis managementpolicy • Monitoring the product or service qualityapproach • Invoking ofEurazeo SE’sresponsibility • Lengthy negative media coverage •

Failure to complywith laws and regulations 4.2.2.2

HIGH Risk that,as partof a procedure,Eurazeois held liablefor prohibited actionswhichare subjectto heavypenalties under thelawsand regulations in force.

Eurazeo andits majority-owned investmentsoperate throughouthe world,andare subject to national and regionallawsandregulations, depending on the country. These activities are liable to be affected by a wide rangeof textsto which they must comply: primarily relating to corporate law, tax law,employment law, anti-trust law, consumer law, environmental law, corporatesocial responsibility, export controls andthe fightagainst corruption. For someregulations,such asanti-trustlaw,anti-corruption law, exportcontrolsor international sanctions, Eurazeo's liabilityas a controlling entity may be triggereddue to the actionsof its portfoliocompanies, including in foreign jurisdictions. This threat is evengreateras an increasingamountof laws are giving national authorities the powers to establish extra-territorial legal proceedings (Sapin II law in France, FCPA in theUSA). Morerecentlyin France, the Dutyof Care Law enshrines the growing trend to make transnational companiesaccountablefor theirsubsidiaries’ actions. This lawaims to introduce an obligation of duty ofcare for parentcompaniesandcontracting companies with respect to subsidiaries, sub-contractorsandsuppliers,particularlyin the supplychain. This accountability seeks to preventthe occurrenceof tragedies in France andabroad andto obtain compensation for victims in the eventof humanrights violationsor environmental damage. Over and above a potentialattempt to trigger Eurazeo's liability should this type of risk arisein oneof its subsidiaries or their sub-contractors, there isa risk to Eurazeo's reputation. Eurazeo and its portfolio companies therefore specifically monitor the following issues: combating child labor, forced labor or slavery, fair compensation, decent working hours, the absenceof discrimination,harassment and inhuman treatment, theprotection ofhealthandsafetyin the workplace. Eurazeo SEand its portfolio companies ensurethe implementation of efficientcompliance programs adapted to the challenges. The post-acquisition projects generally offer portfolio companiesthe opportunity to strengthentheir compliance programs based on the risk assessment performeduring the due diligencephase. Eurazeo iscareful not to interfere in the management of its investments and strives torespect the autonomy of the legal entities in which it invests.Eurazeo informs its portfolio companies of changes in regulations andhelpsthem implement CSR approaches. As part of its monitoring of the investments, each Audit Committee then fully plays its role when monitoring the efficiencyof the compliance systems. Potentialeffects Damage to the reputation/image of Eurazeo •

Examples of risk mitigation measures Coverage ofCompliance/Duty ofCare topics during acquisition due • diligence Regulatory watch • Complianceprograms • Duty ofCare plan • Internal ControlSystem • Portfolio companygovernance (Audit andRisks Committees) • Professional civiliability/corporate officer liability insurancepolicies •

Heavy penalties (criminal, administrative, regulatory) • Loss ofkey agreements/licenses (investmentactivities) • Proceedings involving Eurazeo SE and its executives •

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