LEGRAND_REGISTRATION_DOCUMENT_2017

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Acting ethically towards Society

R 4.3.1.1 AWARENESS AND TRAINING IN BUSINESS ETHICS

annually and updated on the basis of changes in the business or in the regulatory or economic environment. (v) Procedures for the evaluation of third parties In the course of its business, Legrand has business relations with various third parties (customers, suppliers, intermediaries, subcontractors, banks, etc.). Any association with third parties unable to offer sufficient guarantees in terms of integrity poses a legal, commercial and financial risk to the Group, whose image and reputation could also be affected. To avoid being directly or indirectly implicated in cases of corruption, fraud or non- compliance with international sanctions, the Group has put in place specific evaluation procedures. These ensure that effective or potential business partners provide sufficient guarantees in terms of integrity. (vi) Accounting control procedures and tools for preventing and detecting corruption The Group has set up accounting control procedures in four areas of its compliance program: compliance with competition rules, the application of best business practices (including anti-corruption), the prevention of conflicts of interest and management of fraud risks, the observation of international embargoes and sanctions, and the prevention of money laundering and terrorist financing. These procedures cover Legrand’s various processes (finance, accounting, taxation, treasury, purchasing, sales, fixed assets, inventory, human resources), and take into account interactions with the Group’s internal and external stakeholders. These procedures are also based on the principle of the segregation of duties, with different people responsible for approval, action and decision-making. The procedures and their effectiveness are assessed by Group Internal Control. (vii) Training program for corruption risks On this point, please refer to section 4.3.1.1 of this document, in the paragraph "communication and training". (viii) Internal evaluation and control program To ensure the adequacy and effectiveness of the measures implemented, each year Internal Audit evaluates the five stages of the compliance program to measure its effectiveness and deployment in the Group’s entities and countries. Evaluation of the compliance program covers five key controls: involvement and sponsorship of local departments; self-assessment of risks carried out annually by the Group’s various countries and entities; monitoring procedures and mechanisms implemented locally; training and communication to promote the program; oversight and compliance audits.

The effectiveness of the Group’s compliance program involves, upstream, a clear and focused awareness among the Group’s employees, hence the inclusion of continuing staff training in the Group’s Corporate Social Responsibility (CSR) policy. The aim of the Group’s training schemes is to ensure that employees likely to encounter risk situations have a sound knowledge of the rules on business ethics. It also means reducing the likelihood of an infringement of competition law or anti- corruption, anti-money laundering or export control laws, in all Group entities and subsidiaries. Any breach of the Group’s ethical principles by an employee gives rise to a detailed analysis and, if applicable, to sanctions. Monitoring the number of people trained in compliance takes place at three levels: W locally by directors who ensure that their teams have attended and understood compliance training. The number of people trained is calculated through annual reporting coordinated by the Human Resources Department; W by the Legal Affairs and Compliance Department, the CSR Department and the Internal Control Department. As part of the CSR roadmap, the Group has prioritized the training of employees in business ethics. The number of people trained in e-learning is reported annually, and the figures are audited by one of the Group’s Statutory Auditors; W through the internal audit, which ensures that the training program has been properly implemented within the framework of the compliance program and is proving to be effective. Group priority 2014-2018 Train an additional 3,000 employees in business ethics (anti- corruption, fraud prevention, compliance with competition rules, conflicts of interest, etc.). Key performance indicator: the number of employees trained in business ethics during the year. Annual targets:

04

2014 2015 2016

2017

2018

Total number of employees trained in business ethics*

400 900 1,500 2,200 3,000

* Numbers provided for the roadmap period and thus not taking into account employees trained previously

85

REGISTRATION DOCUMENT 2017 - LEGRAND