Hermès - Registration Document 2016

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CORPORATE GOVERNANCE

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

With respect to corporate governance

With respect to corporate governance

s to recommend revisions to corporate governance rules, as needed; s to periodically ascertain that independent Supervisory Board members meet the criteria pertaining to independence and objectiveness set out in the Supervisory Board rules of procedure; s to review the composition of the specialised committees; s to oversee the annual assessment of Supervisory Board practices; s to ascertain that the management bodies apply the Supervisory Board rules of procedure and the recommendations of the AFEP- MEDEF Corporate Governance Code in force in their operations, inter alia.

s analysis of the individual situation of Supervisory Board members (independence, conflicts of interest, plurality of offices, number of shares) and of the Committee members (special skills with regard to finance or accounting); s update and distribution of Supervisory Board documents (master file, rules of procedure, 2016 calendar of blackout periods); s review of the report from the Chairman of the Supervisory Board on corporate governance principles applied by the Company, with regard to the composition of the Board and the application of the principle of balanced representation between women and men within the Board, the conditions for the preparation and organisation of the Supervisory Board’s work, and the internal control and risk management procedures set up by the Company; s proposal to amend the rules of procedure of the Audit Committee (to adapt them to the new legal provisions related to the reform of audit assignments that came into force on 17 June 2016); s triennial formal assessment of the Supervisory Board to be performed in 2016 (decision to be taken on whether or not to call on an outside firm, process and assessment questionnaire, launch of the evaluation, summary and analysis of results, areas of improvement); s RCMS (Responsabilité Civile des Mandataires Sociaux, senior management civil liability) insurance of members of the Supervisory Board and members of the Audit Committee after the reform of the statutory audit and the new responsibilities arising therefrom. Some of these issues are further discussed in this report. The CAG Committee reviewed current events in matters of governance: s AMF – Recommendation 2012-02 (updated 22 December 2015): Corporate governance and compensation of company Senior Executives with reference to the AFEP-MEDEF Code – Consolidated presentation of the recommendations contained in the AMF annual reports; s HGCE – Application guide for the AFEP-MEDEF Corporate Governance Code for listed companies of June 2013, published in December 2015 by the HCGE (Corporate Governance High Committee); s OECD – Corporate Governance Principles (revised September 2015); s AMF – Report on the Chairman’s report on internal control and risk management procedures (February 2016); s AFEP – Table of voting policies of investors and proxy advisory agencies; s AMF – Study on the reports of Chairmen on internal control and risk management procedures in respect of 2014 (February 2016); s Your director – Governance and life of the business: feedback from Senior Executives and directors (February 2016); s HCE|fh – Interim evaluation report on the implementation of the laws of 27 January 2011 and 12 March 2012 (February 2016); s AFG – Recommendations on Corporate Governance (January 2016); s AMF – Comparative study of corporate governance codes in 10 European countries (30 March 2016); s Spencer Stuart – Study on assessing the contribution of individual directors (April 2016); s AFEP-MEDEF – Study on the application of the corporate governance code by Hermès International; s self-assessment of the CAG Committee; s AFEP – Appraisal of the 2016 General Meetings;

s HGCE – 2016 Annual Report;

s Spencer Stuart – France Board Index 2016; s EY Labrador – Governance Panorama 2016;

s Russell Reynolds – 2016 study of the governance of the CAC 40 companies;

s AFEP – Employee representation on Boards;

s BP2S – Review of AGMs, 2016.

The work and operation of the CAG Committee were assessed in 2016 as part of the triennial formal self-assessment of the Supervisory Board, and were deemed very satisfactory overall.

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2016 REGISTRATION DOCUMENT HERMÈS INTERNATIONAL