SCH2017_DRF_EN_Livre.indb

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Corporate governance report Interests and compensation of Group Senior Management

In keeping with the previous plans, the board decided that it would allocate the following to the Corporate Officers in 2018:

Number of Shares (Plan No. 31)

Number of Shares (Plan No. 30) (1)

Officer

Jean-Pascal Tricoire Emmanuel Babeau

18,000

42,000

7,800 18,200 (1) The performance shares granted only to Corporate Officers on account of their office, are subject to a 1-year additionnal holding period.

In accordance with the Group internal rules, Mr. Babeau will not receive attendance fees from any directorship in Group companies. Additional Cash Benefits for Pension Building Since the board’s decision in 2015 to move away from the “Art. 39” defined-benefit pension schemes due to the excessive cost of such “top hat” pension plans, the Corporate Officers have to build their own pension and to this end, are granted a combination of fixed and variable payments that are considered “other benefits” to ensure consistency and comparability with other French or international companies. The variable payment is aligned with the annual incentive in terms of criteria and rate. The Corporate Officers have committed to depositing these additional payments, after taxes, into investment vehicles dedicated to the supplementary financing of their pensions. The amounts have been revised in proportion to the proposed increase of the base salary, and stand as follows:

The volume of the distribution, which would remain unchanged, was set with consideration for: E Thetotalvolumeof thepreviousplans,withaviewtowardcontinuity of the incentive policy for executives and competitiveness; E The number of shares allocated to other Group executives who are eligible to the same multi-year profit-sharing plan: for 2018, the number of shares that may be allocated to the Corporate Officers in accordance with Plans No. 30 and 31 would make up 3.6% of the total of the aforementioned plans; and E The resulting cost for the Company. The number of shares granted represents a cap. In no circumstance, even in case of overachievement of all targets, the number of shares acquired may exceed the number of shares granted. Attendance Fees Mr. Tricoire has waived the attendance fees to which he is entitled in his capacity of Chairman of the board in pursuance of the distribution rules adopted by the board.

Variable portion

Fixed portion (€)

Total at Target (€)

Officer

Target Award target

Min (€)

Max (€)

Jean-Pascal Tricoire Emmanuel Babeau

€191,600 €153,300

130% €249,080 100% €153,300

€0 €0

€498,160 €306,600

€440,680 €306,600

Other Benefits of Any Type Employer Matching Contributions and Profit-Sharing In financial year 2018, both Corporate Officers are eligible for profit- sharing and the employer matching contribution paid to subscribers to the capital increase reserved for employees. Both Corporate Officers are also eligible for the employee matching contribution paid to subscribers to the collective pension fund (PERCO) for the retirement of workers in France.

Company Car and Travel Expenses Travel and business expenses for Messrs. Tricoire and Babeau are covered by the Group. The Corporate Officers may use the cars made available to Group Senior Management with or without chauffeur services. In addition, each has been provided with a company car. Neither is eligible to be reimbursed for other costs.

2017 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC

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