SCH2017_DRF_EN_Livre.indb

3 Corporate governance report Board activities

3. Board activities

The board of directors devoted most of its activities to the company’s corporate governance, strategy and its implementation, reviewing operations and the annual and interim financial statements, which it approved, and preparing the Annual Shareholders’ Meeting.

Attendance

The board held 8 meetings in 2017. The meetings lasted 6 hours on average with an average participation rate of directors of:

90

Four directors have an attendance rate of 100% et none have an attendance rate less than 75% . The average participation rate at the committees’ meetings is detailed hereafter.

3.1 Corporate governance The board of directors, depending on the subject, upon the report of the Governance and remunerations committee, the Human Resources and CSR committee or the Audit and risks committee: E discussed the composition of its membership and that of its committees and the principle of balanced representation of men and women. To this end, it proposed to the Annual Shareholders’ Meeting of April 25, 2017, which approved it, to renew Jean-Pascal Tricoire’s term which was due to expire, in order for him to pursue the implementation of the strategy defined by the board of directors in his capacity as Chairman and Chief Executive Officer. The office of Mr. Babeau as Deputy CEO was also renewed. It also pursued the “refreshment” of its composition, and with the reaffirmed objectives of increasing the proportion of international and women members and of carrying on the rejuvenation process, it proposed to the Annual Shareholders’ Meeting to vote in favor of Ms. Xiaoyun Ma as director representing the employee shareholders to take over from Ms. Magali Herbaut, whose term was due to expire and who did not wish to be renewed. Ms. Xiaoyun Ma was appointed director representing the employee shareholders on April 25, 2017. It further proposed to the Annual Shareholders’ Meeting to amend the articles of association to insert the legal provisions relating to the director representing employees. In pursuance of these new statutory provisions approved by the Annual Shareholders’ Meeting of April 25, 2017, Mr. Patrick Montier was designated as director representing the employees by the most representative trade union at the Group level in September 2017. The board of directors also deliberated on the composition of its committees. In this respect, it appointed Ms. Cécile Cabanis as Chair of the Audit and risks committee in replacement of Mr. Gérard de la Martinière whose term as director expired at the end of the 2017 Annual Shareholders’ Meeting and who did not wish to be renewed, and Ms. Xiaoyun Ma as member of the Human Resources and CRS committee, in compliance with the

requirements of the AFEP/MEDEF Corporate Governance Code of listed companies recommending that an employee director sits on the Remuneration committee. E discussed whether to maintain the unification of the functions of Chairman and CEO (see above p. 167); E examined the succession plan for corporate officers at one of its “executive sessions”; E deliberated on its formal self-assessment at its meeting of December 14, 2017, and approved an action plan; E finalized the study of the fairness and efficiency of the methodology applied by the board of directors for the setting of the compensation of the corporate officers. The findings of the study were presented in chapter 8 section 1 of the 2016 Registration Document; E discussed and reviewed the principles and criteria relating to the compensation of the corporate officers and approved the compensation and benefits of all types that may be or had been granted; E was informed of the meetings with major shareholders conducted by the Vice-chairman independent lead director on governance topics; E was informed of the review of changes in the compensation of members of the Executive Committee; E was informed of the work done by the Human Resources and CSR committee on the succession plan for members of the Executive Committee; E decided the implementation of the 2017 long-term incentive plan. It accordingly reviewed the performance conditions (see p. 194), drew up a list of beneficiaries (which includes the corporate officers) and set the terms of individual awards; E checked and recorded the calculation of the level of achievement of performance conditions applicable to Performance Share plans 21, 21 bis , 22 and 22 bis ;

2017 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC

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