PSA - 2019 Universal Registration Document

CORPORATE GOVERNANCE Management and supervisory bodies

MANAGEMENT REPORTOF 3.1.3.5. THE SUPERVISORY BOARD IN 2019

In addition,in accordancewith a decisiontakenby the Supervisory Board and on the recommendation of the Appointments, Compensationand GovernanceCommittee,a process to acquaint new members with the automotive industry was established. Trainingmade up of differentmodules– financialcomponents,the operationof an automotiveplant,the differentautomotivemarkets, challengesfor the automotiveindustry, overviewof research and development, HR and CSR priorities – was provided to new membersin February 2019.This inductionenablesnewmembersto perform their duties armed with more information, study the Board’s and committees’ cases more effectively and meet the managersof the Group’s different departments.This trainingwas developedin line with the recommendationsof the AFEP-MEDEF Codeas revisedin June 2018(Section 12). The Supervisory Board alsodiscussedthefollowingitems: Businessand finance: the checks and audits of the consolidatedfinancial statements n and the Peugeot S.A.companyfinancialstatementsfor the year 2018 and of the financial position at end 2018, together with examination of the relatedfinancialreleases; the preparationof the Shareholders’GeneralMeetingon 25 April n 2019 and the approval of the reports presented to the Shareholders’General Meeting; review of the major strategic guidelines as proposed by the n ManagingBoard (theseguidelinesreceiveda favourableopinion from the WorksCouncil,whichwas made known to the Board), and the prior authorisationfor variousstrategicprojects,and for the relatedfinancial operations; the checks and audits of the earnings and the financial n statementsfor the firsthalfof 2019,theHalf-yearFinancialReport andthe relatedfinancial releases; the approvalof the 2020budgetand the medium-termplan,and n the agreementon capitalexpenditures above €50 million; the amendmentof Article 1 of the SupervisoryBoard’s internal n rules. (For information,the authorisationthresholdprior to the Executive Committee proceding with the purchase, sale, exchange or contribution of any business premises and/or businessand the purchase,holdingor disposalof any interestin other companies created or to be created and accounting, directly or indirectly, for an investment, an expenditure (in enterprise value) or a loan or liability guarantee, whether immediate or deferred, is set at €100 million instead of €50 million.In addition,the SupervisoryBoardmust be informet of any transactionsof this typeof intermediateamountsbetween €50 million and€100 million); the authorisationof a sharebuybackprogramme in orderto fund n an employeeshareholding transaction; Groupe PSA’s prior authorisation for jointarrangements; n the renewal of the annual authorisation to give sureties, n endorsementsand guaranteesand the review of the regulated agreements ineffectduring2019; the audit of Groupe PSA’sCSR (corporatesocial responsibility) n policy, thereviewof the vigilance plan adopted by the Company; the review of the new regulatory and legislative measures n affectingthe work ofthe governance and managementbodies; the authorisationof the plan to convertPeugeot S.A. into an S.E. n (European Company).

The SupervisoryBoardmet eighttimesin 2019,comparedwithnine times in2018. The attendance rate of itsmembersat the meetingswas92%. In 2019, the second phase of the “Push to Pass” plan began, and 2019 was the third year of the implementationof the “PACE!”plan for Opel-Vauxhall.During the year, special attentionwas given to the CO 2 plan and the electrificationof the productrange, and the sale by the Group of its 50% stake in the CAPSA Chinese joint venture was decided on. The year 2019 was a historic time that featured the negotiation of the terms and the signature of the planned merger between Groupe PSA and the FCA Group in December 2019.This planwas authorisedby the SupervisoryBoard at itsmeeting on 17 December 2019. The SupervisoryBoard devoted particularattention to these two events during its meetingsas well as during the Seminarsand the meetingsof the specialcommittees. TheSupervisoryBoardmembersmet in Moroccoin Octoberto hold theirmeetingandvisitthe newPSAKenitraplantand its integration in the Atlantic Free Zone industrial platform, as well as the new Regional Decision-Making Centre and the new Research and DevelopmentCentre, both in Casablanca. The priorities for the AfricaandMiddleEastregionwerealsosharedwiththe Supervisory Board. The strategic seminar in September offered an opportunity to discussthe automotiveenvironment, includingthe main trendsand overviewof competitors,the progressof the “Push to Pass” plan, the businessresultsin China,after-salesand usedvehicles,strategic topics related to the managementof CO 2 and electrification,the integrationof Peugeotin NorthAmerica,Citroënin India and Opel in Russia,and the developmentplanfor connectedandautonomous vehiclesand lightcommercial vehicles. Regardingcorporategovernanceworkand decisions,because2019 was the twelfth year of the term of office of two independent members who resigned (Geoffroy ROUX de BEZIEUX and Henri REICHSTUL),the Board started the process of selectingtwo new candidatesto serveas SupervisoryBoardmemberswith the aim of recommending them to the Shareholders’ General Meeting as replacements for the outgoingmembers. The Appointments, Compensation and Governance Committee worked on and implementedthe successionplan for the Board memberswith assistancefrom a recruitmentfirm and in line with the diversitypolicy. Applicationswereevaluatedbasedon expertise,experienceand the diversity of the backgroundsof the candidatesand those of the current Boardmembers,as well as the applicablerules on gender equality. On 25 April 2019, the Shareholders’ General Meeting approvedthe appointmentsof Gilles SCHNEPPand Thierryde LA TOUR D’ARTAISE on the recommendationof the Supervisory Board. Gilles SCHNEPP was selected because of his experience as an executivemanagerof a French industrialgroup, LEGRAND,which does considerablebusinessat the internationallevel. Followinghis appointment, Gilles SCHNEPP was appointed Vice-Chairman, Chairman of the Appointments,Compensationand Governance Committee, member of the Finance and Audit Committee and Senior IndependentMember.Thierryde LA TOURD’ARTAISEwas selected because of his backgroundas Chairman and Managing Directorof the SEB Group,a Frenchgroup that does considerable businessat the internationallevel. Mr de LA TOURD’ARTAISEwas appointed member of the Strategic Committee and Asia Committee.

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GROUPE PSA - 2019 UNIVERSAL REGISTRATION DOCUMENT