PSA - 2019 Universal Registration Document

CORPORATE GOVERNANCE Compensation of company officers

COMPENSATION OF COMPANY OFFICERS 3.2.

Meetingof 25 June 2020 ( sixth to tenth resolutions ), pursuantto Article L. 225-82-2 of the FrenchCommercialCode,as amendedby Order No. 2019-1234 of 27 November 2019. It also reportson the componentsof total compensationand fringe benefitspaid or allocatedto the companyofficersin respectof the 2019financial year,accordingto the compensation policywhichwas approved by the Shareholders’ General Meeting on 25 April 2019. These components will be submitted for the approval of the Shareholders’ General Meeting on 25 June 2020 ( eleventh to sixteenthresolutions ), pursuantto Article L. 225-100 of the French Commercial Code, as amended by Order No. 2019-1234 of 27 November 2019.

This chapterincludesinformationon the principlesand criteriaused for determining,distributingand allocatingthe componentswhich make up the overall compensationand fringe benefitsattributable to the Chairman of the Managing Board, the members of the ManagingBoardand the membersof the SupervisoryBoard.It was producedby the SupervisoryBoard at its meetingon 25 February 2020, with the assistanceof the Appointments,Compensationand Governance Committee which is mindful of following the recommendations in the AFEP-MEDEF Code. The principles and criteria defined by the Supervisory Board constitute the compensationpolicy applicable to the company officers,as submittedfor the approvalof the Shareholders’General

Compensation policy applicable to members of the Managing 3.2.1. Board and its Chairman

THE PROCESS FORDETERMINING THE COMPENSATION POLICY, 3.2.1.1. IN THE INTERESTS OF GROUPE PSA, ITS SHAREHOLDERS AND STAKEHOLDERS

Each year on the recommendation of the Appointments, Compensationand GovernanceCommittee,the SupervisoryBoard commentson and approvesthe compensationpolicyfor executive company officers. The Supervisory Board ensures that the compensation policy complies with the principles of comprehensiveness, balance, comparability, consistency, intelligibility and measurability, in accordance with the recommendations of the AFEP-MEDEF Code. Similarly, the Board approves the compensation policy for its executive managers to support the commercial strategy and long-termprospectsof Groupe PSA, throughstringentperformance criteria that reflect the Group’s priorities. Variable annual and long-term compensation are the biggest components of total executivemanagerscompensation. Consequently, the Board ensures that this policy reflects Groupe PSA’scorporateinterestsand thoseof its shareholdersand that it is both incentivisingand competitive, in a highlycompetitive international automotive market. Thus,everyyear the Appointments,CompensationandGovernance Committee conducts preparatory work to support the Board’s decision-makingon compensationand, in this context,reviewsthe situation of competitors of Groupe PSA in terms of long-term strategyand in terms of the level of compensationof its Executive managersand, on the other, the challengesand future strategyof Groupe PSA and its Executive managers. In particular, the compositionof the Appointments,Compensationand Governance Committee, which is made up mainly of independentmembers, helps to preventconflictsof interestin the processof determining principles, criteria and levels of compensationof the Managing Board.

This work is done throughoutthe year in the form of quarterly reports submittedto the Board by the ManagingBoard and the medium-and long-termstrategy,and finalisedat two meetingsof the Appointments,Compensationand GovernanceCommittee in February. TheAppointments,CompensationandGovernanceCommitteethen submits recommendationsto the Board which discusses and approvesthe principlesof compensationto be put to the vote of shareholders. Where a new member of the Managing Board is appointed mid-year,the Boarddiscussesthe componentsof compensationto be awarded,in accordancewiththe compensationpolicypreviously approved by the Shareholders’ General Meeting. Accordingto the sameprinciple,the Boardoverseesthe policyand principlesof compensationapplied to all Groupe PSAemployees. Thispolicy,drawnup by the Group’sHumanResourcesDepartment in line with the Executivecompensationpolicy,is subjectto annual review by the SupervisoryBoard, which discussesit and gives its opinion. The Board ensures that the principlesof employeecompensation are determinedin line with the Group’s corporateobjectivesand strategy and strives to ensure that employee compensation is incentivising and competitive. This approach incorporates the implementationof incentivising performance-based share plans for senior and executivemanagers as well as key talentsin the Groupwho contributeto the long-term successof strategic priorities.

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GROUPE PSA - 2019 UNIVERSAL REGISTRATION DOCUMENT