SCH2017_DRF_EN_Livre.indb

1 Overview of the Group’s strategy, markets and businesses Group strategy and market opportunities

India: Future-proofing the data centers of a global IT infrastructure services provider with Schneider Electric solutions and services. Schneider Electric carried out a comprehensive audit for 11 data center sites across India. This resulted in the delivery of a modular and scalable solution with remote monitoring for predictive maintenance supported by Schneider Electric experts. The outcome include savings of up to 50% of floor space, 75% less time spent on maintenance and 25% savings on generator capacity. South Korea: The Smart Panel solution implemented in a world-class general construction project incorporated measurement, connection, and powerful energy management capabilities. This project resulted in cost reduction through efficient energy management, improved facility operations and power stability and a 30% reduction in electrical room space. New economies present the biggest long-term opportunity for growth as a result of electrification and digitization. Schneider Electric expects continued opportunities and growth in these markets. Our long-term commitment helps us build an intimate knowledge of these markets and we believe that the strength of our brand, our competitive local supply chain and the development of local marketing and R&D capabilities are competitive advantages. Building differentiated and complementary business models Our 4 businesses offer a wide range of products, services, software and solutions. Each of these offers have different revenue growth and profitability profiles, complementing each other to fulfil our partners’ and customers’ needs. With a strategy of accelerated growth of our profitable businesses and improvement in our systems, Schneider Electric focuses on selling: E More products through our industry-leading partner network offering a wide range of market-leading products supported by a superior digital customer experience. Our products offer best-in-class technology to our distributors and direct partners, such as contractors, system integrators and electricians, who provide the ability to reach large numbers of small and medium- sized customers. Our connected products, the “things” of IoT, connect seamlessly to higher-level systems and software, with embedded cybersecurity. E More services to partners and end users to maximize the business value of their installations and optimize their processes. Schneider Electric offers a wide range of services, such as digitally enhanced field services to our large installed base, digital services providing customers with the right information in the right place and time and advisory services, such as energy management and sustainability services helping end users understand and optimize their energy and resource use. With a network of over 37,000 qualified technicians and domain experts, Schneider Electric gives our customers optimized performance and peace of mind. E More software to drive efficiency and control for our partners and end users. In the past 5 years, Schneider Electric has developed of a full portfolio of software, apps, and analytics to permit, enable and catalyze optimization. With the recent

integration of AVEVA, we have created a global leader in industrial software, with scale and relevance in key markets and an extensive technology portfolio. This will provide our customers with a comprehensive and open software portfolio offering an unmatched set of end-to-end solutions covering all aspects of digital asset management from process simulation to design, construction and manufacturing operations. E A better system where we focus on delivering more specialized systems (equipment & projects), both through our partners or direct to end users, with tested and validated reference architectures. They provide significant opportunities to develop greater customer intimacy and stickiness through dialogue with final end-users, which in turn helps inform the Group’s quest for continuous innovation. Our products, services, software and solutions are all combined in EcoStruxure™, our open, interoperable, IoT-enabled system architecture and platform. EcoStruxure™ delivers enhanced value around safety, reliability, efficiency, sustainability, and connectivity. EcoStruxure™ leverages advancements in IoT, mobility, sensing, cloud, analytics and cybersecurity to deliver Innovation at every level, from Connected Products, Edge Control to Apps, Analytics & Services. EcoStruxure™ has been deployed in 480,000+ installations, with the support of 20,000+ system integrators, connecting over 1.5 million assets. Our EcoStruxure™ architecture and interoperable technology platform brings together energy, automation, and software. It provides enhanced value around safety, reliability, efficiency, sustainability, and connectivity. In turn, this advancement opens up the digital world to customers across our end markets, enabling them to be competitive in today’s IoT economy. Investing in profitable and responsible growth while driving efficiency We believe in the high and long-term growth potential of our business and Schneider Electric continuously invests to drive that growth. This investment is focused on sustained spending on research and development, as well as growing our commercial presence and skills, especially in the fields of high value-added technologies and services. In addition to our commitment to organic growth, the Group has invested in companies, joint ventures, strategic alliances and mergers that have reinforced our global leadership, provided skills in energy management and automation, or related to local businesses in new economies. Finally, driving efficiency at all levels of the Company is an equally important focus. We continuously seek to generate savings from purchasing and manufacturing and through improving operational efficiency by reducing selling, general and administrative expenses, while maintaining best-in-class standards in environmental sustainability and social responsibility.

2017 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC

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