GECINA - REFERENCE DOCUMENT 2017

01

PRESENTATION OF THE GROUP Summary of the principal risks

Risks

Change over the 2016-2017 period

CONTROL PROCESS

HIGH RISK LEVEL OBSOLESCENCE RISK

Risk of harsher regulations, changes in industry practices or stakeholder expectations, tenants in particular, as regards challenges related to: the well-being of building occupants and ■ their productivity as regards offices, see section 7.3.1; the overall energy performance of the ■ assets, see section 7.5.2; the carbon footprint of the real estate ■ assets, see section 7.5.1; the biodiversity incorporated into the plots ■ of land, see section 7.4.2.; accessibility by everyone to the assets, see ■ sections 7.4.3. and 7.4.4. ; the adaptability of assets and leases to ■ changes in tenant use, see section 7.3.2. Impacts: non-compliance or inadequate assets to ■ meet market expectations because the company failed to foresee such changes; loss of asset attractiveness and valuation ■ upon purchase and leasing; image and reputation. ■

generally speaking, the CSR approach ■ includes objectives and action plans associated with each of the issues that impact this risk and are identified as priorities following the materiality analysis. Performance monitoring is measured using indicators whose development is discussed in chapter 7 of this document; more specifically, Gecina has set a target ■ for reducing greenhouse gas emissions from its operating property assets (all uses combined) for 2030 (with an interim review in 2020). This objective was recognized by the Science Based Targets initiative as being compatible with the trajectory required to maintain the average rise in temperature at 2°C (see section 7.5.1. “Carbon impact management”). In addition, Gecina has a carbon offsetting fund that is funded by those residual emissions and an internal carbon price of €25/t. This fund contributes to the resilience of Gecina’s economic model in the event that a global carbon tax comes into effect; in addition, quality and client satisfaction ■ surveys are conducted with tenants to discern changes in their expectations. The intelligence gathered from this monitoring is reflected in updates to building renovation budgets, and acquisition and sale criteria. these operations are monitored from a ■ legal standpoint by the Group’s internal teams with the support of law firms in France and in Spain; finally, new developments of these risks ■ are regularly reported to the Audit and Risk Committee. CORPORATE DISPUTE RISKS

Risk, management of which is incorporated in Gecina's strategy and organization, remained stable in 2017. In the medium term, all issues are taken into account through CSR efforts and translated into action plans for each business. In addition, our carbon footprint, an issue that needs to be handled over the long term, has been added to our action plan and objectives for 2030, on a trajectory intended to achieve carbon neutrality of all assets by 2050.

Risks linked to acquisitions and commitments made in Spain, during Mr. Joaquín Rivero’s term as Chairman and CEO. The company cannot rule out an unfavorable development of these operations or the emergence of additional financial, legal or regulatory risks. Impacts: deterioration in the Group’s results. ■

Risk was stable over the period. It remains affected by uncertainties about the succession of Mr. Rivero. The Group strives to maintain a high level of attention and control over these risks, which tend to evolve by nature.

26 GECINA - REFERENCE DOCUMENT 2017

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