Hermès - Registration Document 2016

CORPORATE GOVERNANCE

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

s monitor the process of preparation of financial information and, where appropriate, make recommendations to ensure its integrity; s monitor the effectiveness of internal control and risk management systems, as well as internal audit where appropriate, regarding the procedures for the preparation and processing of accounting and financial information, without prejudice to its independence; s issue a recommendation to theSupervisory Board, prepared in accor- dance with Article 16 of regulation (EU) 537/2014, on the Statutory Auditors whose appointment or renewal is proposed to the General Meeting; s monitor the performance of duties by the auditors in the light of the High Commission on Statutory Audit consecutive to controls made pursuant to Articles L. 821-9 et seq.; s ensure compliance by the auditors with the independence require- ments of Articles L. 821-9 et seq. of the French Commercial Code, take measures necessary for the implementation of paragraph 3 of Article 4 of regulation (EU) 537/2014 cited above and ensure com- pliance with the conditions mentioned in Article 6 of this Regulation; s approve the provision of services mentioned in Article L. 822-11-2; s report regularly to the Supervisory Board on the performance of its duties; s also report on the results of the engagement regarding the certifica- tion of the financial statements, on the way the engagement contri- buted to the integrity of financial reporting and the role it has played in this process. s promptly inform the Supervisory Board of any difficulties encountered. In the performance of thesemissions, the Audit Committeemay carry out site visits to appraise the overall consistency of the internal control and risk management system. C. Operation of the Audit Committee The Audit Committee meets as many times as necessary and at least twiceayear,beforeannualaccountclosurebytheExecutiveManagement and before the half-year accounts examination by theSupervisory Board. The Audit Committee meets when convened by its Chairman, who sets the agenda of the meeting in writing or verbally, wherever indicated in the notice of meeting. Before each Audit Committee meeting, Audit Committee members are sent, in good time, with reasonable lead time and subject to confidentiality requirements, a file containing documenta- tion on items on the agenda requiring prior analysis and review. TheroleofsecretaryoftheAuditCommitteemeetingsisperformed,ifthey are present, by the Audit and Risk Management Director, otherwise by a member of the Audit Committee appointed as reporter by the Chairman. The proceedings are noted in minutes which are entered in a special register and signed by the Chairman of the Audit Committee. Certain persons who are not members of the Audit Committee – in particular the Statutory Auditors, the Audit and Risk Management Director, the Financial Director and the Executive Management – are regularly invited to Audit Committee meetings. The Audit Committee may invite other Senior Executives for targeted exchanges, based on addi-

Audit Committee rules of procedure Version no. 2 of 8 July 2016 Purpose

These rules of procedure define the composition, missions andmethods of organisation and operation for the Hermès International Audit Committee, which acts under the collective and exclusive responsibility of the Supervisory Board. Its purpose is to enhance the quality of the Audit Committee’s work by promoting the application of good corporate governance principles and best practices, in the interests of ethics and greater effectiveness. A. Composition of the Audit Committee Chairmanship – Number of members The Chairman of the Audit Committee is appointed by the Supervisory Board. TheAudit Committeecomprisesat least fourmembers of theSupervisory Board. Proportion of independent members At least half of the members of the Audit Committee must, at the time of their appointment and for the term their office, be qualified as inde- pendent under the Supervisory Board’s rules of procedure. At least one of the members of the Audit Committee must be appointed from among the independent members of the Supervisory Board and have specific expertise in financial or accounting matters or statutory audit. Term of appointment to the Audit Committee The members of the Audit Committee are appointed by the Supervisory Board for the duration of their term of office as a member of the Supervisory Board or for any other term defined by the Supervisory Board. They may be reappointed indefinitely. B. Missions of the Audit Committee The Audit Committee studies and prepares certain proceedings of the Supervisory Board and submits to the Board its opinions, proposals and recommendations. In application of Article L. 823-19 of the French Commercial Code (Code de commerce), and without prejudice to the powers of the Supervisory Board, which it does not replace, the missions of the Audit Committee are: s to review and comment on the Company’s parent company and consolidated financial statements prior to approval by the Executive Management; s to ascertain that the accounting methods applied are relevant and consistent; s to verify that internal data collection and control procedures gua- rantee the quality of information provided; s to review the work programme and results of internal and external audit assignments; s to carry out special tasks assigned to it by the Supervisory Board;

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2016 REGISTRATION DOCUMENT HERMÈS INTERNATIONAL

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