Hermès - Registration Document 2016

CORPORATE GOVERNANCE

REPORT FROM THE CHAIRMAN OF THE SUPERVISORY BOARD ON THE CORPORATE GOVERNANCE PRINCIPLES

• new questions about the involvement of independent members and their role in a family company and the establishment of Herboard. Anonymousandaggregaterestitutionoftheanalysisoftheanswerstothe questionnaires was performed by the Chairman of the CAGCommittee at the Supervisory Board meeting of 18 November 2016. The vast majority of questions resulted in ratings of “very good” or “satis- factory”, in the proportion of 80% or more. Analysis of the results of the assessment showed that: s progresshasbeenmadeonmanypointssincethe2013assessment: • the composition of the Board has improved since the last assessment, • the dashboard is satisfactory, • the independent members are fulfilling their role, • Herboard has given overall satisfaction, • all Board members make a satisfactory individual contribution, • since the last assessment, progress has been made on the orga- nisation and content of the meetings of the Board, • since the last assessment, progress has been made on the orga- nisation of the Audit Committee, Account for the existence of a succession plan for Senior Executives indicating that it was presented by the Executive Management at the CAG Committee meeting on 16/11/2016 (without publishing its content) Update references to the AFEP-MEDEF Code in the Supervisory Board’s rules of procedure and in the registration document Present the information relative to the Supervisory Board and the committees in the summary tables Provide a detailed summary in the chapter on corporate governance, making it easy to locate and read the corresponding information Clearly identify the members qualified as independent by the Board, whether or not they are members of specialised committees Improve the presentation of the role of environmental and social responsibility in the Company’s strategy, and a more explicit breakdown of financial and non-financial information Add, in the discussion of the role of the Supervisory Board in the registration document, that the Board will receive a presentation of sustainable development and CSR issues regularly starting from 2015. Areas for improvement implemented in 2016 and early 2017

• since the last assessment, progress has been made on the orga- nisation of the CAG Committee; s new members appointed since 2013 have a very good understan- ding of the functioning and work of the Board; s some Board members wish to see progress on the following points that the Board, on a proposal from the CAG Committee, selected as areas of improvement for the future: • take into account the expectations of Board members (internatio- nal dimension of the Group and nationality) on the composition of the Board when new members are next appointed, • reflect on the conditions governing the distribution of directors’ fees. In view of the conclusions of the above analysis, the Supervisory Board considered that its operation was very satisfactory overall. The Board’s next formal self-assessment will take place in 2019. In late 2016, the CAG Committee reviewed the areas for improvement that had been identified by the Board in 2015. All the improvements, which mainly consisted of refining the text for the “Corporate Governance” section of the registration document to include the latest recommendations in matters of governance have been imple- mented as follows (see table below).

3

Text justifying improvement

2016 HCGE report (Art. 2.2.)

AFEP-MEDEF Corporate Governance Code, revised in November 2016

2016 AMF report on corporate governance and compensation of Senior Executives of listed companies (IV – Art. 1.2) 2016 AMF report on corporate governance and compensation of Senior Executives of listed companies (IV – Art. 4.1.1)

AMF – report on corporate social responsibility (November 2016)

AFEP-MEDEF Corporate Governance Code, revised in November 2016 (§ 24.1.3)

2016 REGISTRATION DOCUMENT HERMÈS INTERNATIONAL

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