GROUPAMA / 2018 Registration document

3 CORPORATE GOVERNANCE AND INTERNAL CONTROL INTERNAL CONTROL PROCEDURES

INTERNAL CONTROL PROCEDURES 3.4

3.4.1

CONTROL ENVIRONMENT

and non-discrimination, etc.), and to employment contracts, vocational training, occupational health, production and transmissionof statistics, legal reports,etc.; “Shared service centre” activities for all payroll operations and ❯ the administrationof personnelfor eight companiesof the Group includingGroupamaAssurancesMutuelles. The Group HR Department also carries out social projects in the consolidatedcompanies,relating to the obligationsof transparency and non-financial reporting covered in the Grenelle II law (publication in the management report of information relating to social impacts – organisation of work, labour relations, diversity, etc.). Note that after audit and verificationby the statutory auditors, Groupamasuccessfullyobtained for 2018 (like the previous year) a certificate ofparticipationas well as an attestation ofsincerity. Internal control is a mechanism that the Group implements to guarantee: the application of instructions and guidelines set by Executive ❯ Management or theManagement Board; compliancewith the laws and regulations, local rules and codes ❯ of conductrelating to the businesses carried out by theGroup; the proper functioning of the internal processes and rules of ❯ each company, particularly those contributing to the safeguarding ofthe Group’s assets; the reliabilityof financial data; ❯ the control of risks of any nature to which each company is ❯ exposed; and, in general, contribute to the control of its activities, the ❯ effectiveness of its operations and the efficient use of its resources. Beyond compliance with the regulatory obligations, the implementationof an internal control systemconstitutesa strategic issue for Groupama essential to the preservation of its interests, the interests of its customers, partners, members and shareholders, and the interests of its staff or even its existence in case of a major event. In this context, the general principles, objectives, and organisation of internal control of the Group and Groupama Assurances Mutuelles were defined in a policy approved by the Board of Directors of Groupama Assurances Mutuelles in 2015. For the Group’s entities, this policy constitutes the common reference to be respected in the deployment oftheir internal control processes. As auditing is part of the internal control procedure, a Group and Groupama Assurances Mutuelles audit policy supplements the provisionsof the internal control policy with its own operating rules and scope of operation. Risk management policies as well as a compliance policy, defining the overall framework for implementationand operation of the compliancesystemwithin the Group, completethe generalinternal control system. INTERNAL CONTROL ORGANISATION AT THE GROUP LEVEL 3.4.2

Strategy 3.4.1.1 GroupamaAssurancesMutuelles is the central body of Groupama. As such, it is in charge of defining and coordinating the implementation ofthe Group’s strategy in the companies: the Group’s medium-termand long-term strategic focuses are ❯ determined bythe managing bodies; they are implemented in the short or medium term in ❯ accordance with a Group Strategic and Operational Planning (“SOP”) process. The SOP involves the development of provisional corporate income statements,IFRS financial statementsand analyticalresults by business line for each entity. It is broken down into operational action plans pertaining to annual performance targets and thus constitutes the path for the period of the plan and the Group elements ofreferencefor managing the entities. The strategicplan is defined for aperiod of three years. On the France scope, the national consolidation of objectives is approvedby the Group’s executivebodies. Internationally, each subsidiary develops its OSP just like the Group’s other entities, submitted to the International Subsidiaries Department andthe Group’s Executive Management for validation. Human Resources (HR) 3.4.1.2 The responsibilitiesof the Group HR Departmentcover three main areas: corporate activities: implementation of Group policies, ❯ coordinationof HR networks,support and advice for companies and dialogue between workforce and management with the EuropeanWorks Council, the Group committee, and the UDSG (Groupama Social Development Unit), in a Group structure in which each company (around forty) has a Human Resources Department in charge of HR management and employee relationsunder the authority of aChief Executive Officer. In order to promote the establishmentof corporate policies and the implementation of control and compliance systems, the Group HR Department relies on an HR Operational Committee made up of the HR Departments of the Group’s French companies (Groupama Assurances Mutuelles, subsidiaries and regional mutuals). The Group HR Department is also in charge of employee relations within the UES (Economic and Social Unit), with the aim of managing all information/consultationprocesses relating to the projects and activities of its member companies (Groupama Assurances Mutuelles, Groupama Gan Vie, Gan Patrimoine, Gan Prévoyance, Groupama Supports et Services, Gan Assurances); activities related to the HR Department of the “company” ❯ Groupama Assurances Mutuelles involving internal checks to ensure that labour laws and regulations are properly enforced: compliance with legal and contractual obligations related to corporate dialogue, human resources development (diversity

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REGISTRATION DOCUMENT 2018 - GROUPAMA ASSURANCES MUTUELLES