SAINT_GOBAIN_REGISTRATION_DOCUMENT_2017

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Corporate governance Management and Directors’ compensation

b) Annual variable compensation The annual variable compensation, expressed as a percentage of his annual fixed compensation, is allocated to the Chairman and Chief Executive Officer in recognition of his contribution to the Group’s results for the year. At its meeting of February 23, 2017, based on the recommendation of the Nomination and Remuneration Committee, the Board decided to maintain the cap on Pierre-André de Chalendar’s variable compensation for 2017 unchanged, at 170% of his annual fixed compensation (cap unchanged since 2014). Based on the recommendation of the Nomination and Remuneration Committee, during the same meeting, the Board also decided on the components and objectives of Pierre-André de Chalendar’s 2017 variable compensation, as follows (structure unchanged since 2014): concerning the quantitative portion of the variable „ compensation, which represents two-thirds, the four following objectives adapted to the strategy of the Group, each counting for 25%, were defined: ROCE (Return on Capital Employed), „ the Group’s operating income, „ the Group’s recurring net income per share, and „ OFCF (Operating Free Cash Flow); „ a qualitative portion consisting of one-third, based on the „ following three objectives: continuation of the Group’s digital transformation, „ implementation of the corporate social responsibility „ policy, and continuation of the Group’s development strategy. „

The following chart presents the distribution of the various components of the compensation of Pierre-André de Chalendar, Chairman and Chief Executive Officer, paid or granted in respect of fiscal year 2017.

COMPENSATION SUBJECT TO PERFORMANCE CONDITIONS

37% VALUE OF THE 2017 PERFORMANCE SHARES = €1,710,478

24% 2017 FIXED COMPENSATION = €1,100,000

32% 2017 VARIABLE COMPENSATION = €1,487,270

6% VALUE OF THE 2017 OPTIONS ALOCATIONS = €293,626

The various components of the compensation paid or granted to Pierre-André de Chalendar in respect of fiscal year 2017 were decided by the Board of Directors at its meetings of February 23, 2017, November 23, 2017 and February 22, 2018, as follows: a) Fixed compensation The fixed compensation component is commensurate with the Chairman and Chief Executive Officer’s experience and responsibilities in this role, and shall be compared with fixed compensations offered by large companies that are similar in terms of their sales, workforce and international footprint. The level of the fixed compensation is reviewed at relatively long intervals. Pierre-André de Chalendar’s 2017 fixed compensation was set by the Board at €1,100,000, an amount that has not changed since 2010.

Variable compensation owed for fiscal year 2017 to the Chairman and Chief Executive Officer was set by the Board of Directors at its meeting of February 22, 2018, at the proposal of the Nomination and Remuneration Committee, as follows:

Weighting of objectives

Assessment scale for each objective

Percentage completion

Completion by amount ( in EUR )

b

ROCE

25% 25% 25% 25%

0 to 100% 0 to 100% 0 to 100% 0 to 100%

79% 78% 96% 64% 79% 80% 80%

246,848 242,449 300,077 199,226 988,600 498,670

Group operating income

Quantifiable objectives* (2/3), of which:

Group recurring net income per share

OFCF

Total quantifiable Qualitative (global)

2/3 1/3

-

Qualitative objective (1/3) TOTAL VARIABLE SHARE

0 to 100%

100% 1,487,270 For each quantifiable objective, the corresponding portion of variable compensation becomes payable if from 91% to 93% of the budget is achieved, depending on the objective concerned, * and it reaches its maximum if the objective reaches 109% to 111% of the budget, depending on the objective concerned (with base 100ɸcorresponding to the budget). If actual performance is less than the above-mentioned thresholds from 91% to 93%, the portion of variable compensation corresponding to the objective in question is equal to 0. When the budget is met, the variable compensation determined according to all quantifiable criteria is 68% of the fixed part of his compensation. Within the Group, the budget is based on ambitious objectives that are not always met and the variable compensation’s objectives are therefore challenging. -

150 SAINT-GOBAIN - REGISTRATION DOCUMENT 2017