EURONEXT_Registration_Document_2017

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CORPORATE GOVERNANCE

Corporate Social Responsibility

2.5.2

PRESENTATION OF THE BUSINESS ENVIRONMENT

competition between them should be promoted in order to enable market participants the possibility to choose any CSD in Europe. For more information on the competition, see section 1.1.3 Business Environment . Regulatory Environment / regulation Euronext is an organisation that provides exchange listing, trading, post-trade and related services in Europe. The Company operates exchanges in five European countries. Each of the European exchanges and/or its respective operator holds an exchange licence granted by the relevant national exchange regulatory authority and operates under its supervision. Each market operator is subject to national laws and regulations and other regulatory requirements imposed by exchange authorities, central banks and finance ministries as appropriate. The five national regulatory authorities coordinate their regulation and supervision of the regulated markets operated by the Euronext group through the “Euronext College of Regulators”, acting pursuant to memoranda of understanding which Euronext has committed to respect. For more information on the regulation see section 1.4 regulation . Governance The Company is respecting the Corporate Governance Guidelines, Recommendations and Codes set in place in its different locations, and notably: the Dutch Corporate Governance Code 2016 by priority, as it is registered and listed in the Netherlands (see section 2.1), but also the French Afep – Medef Recommendations, and the 2009 Belgian Code on Corporate Governance. The governance of Euronext reflects the highest standards of independence, oversight, and transparency. The Company applies strict principles and guidelines to its own governance practice and to the companies that list on its markets. Euronext’s two-tier governance is composed of a Supervisory Board and a Managing Board. The Supervisory Board ’s main task is the supervision of the Company’s management. The functions of Chief Executive Officer (“CEO”) (chairing the Managing Board) and Chairman (chairing the Supervisory Board ) are separated. Until October 2017, the Supervisory Board included nine non- executive directors including three female directors. Following a change in the appointment by the newly composed Group of Reference shareholders during summer 2017, one of the directors designated by this Groupwas replaced and the female representation changed to 2 female directors out of nine. Three independent Committees report to the Supervisory Board: the Audit Committee, the Nomination and Governance Committee and the Remuneration Committee. Each Committee is chaired by one of the Supervisory Board members and includes several Supervisory Board members. The General Meeting held on 19 May 2014 has set the annual remuneration for the members of the Supervisory Board in accordance to their role(s), see section 2.4.4 “Remuneration of the Supervisory Board members”.

Euronext main activities Euronext is a pan-European exchange Group offering a diverse range of products and services and combining transparent and efficient equity, fixed income securities and derivatives markets in Amsterdam, Brussels, Lisbon, London and Paris. Euronext’s businesses comprise listing, cash trading, derivatives trading, market data and indices, post-trade and market solutions & other. For more information on Euronext activities see section 1.3.1 Business Overview . The Agility for growth strategic plan For more information about Agility for growth strategic plan see section 1.2 «Strategy «Agility for growth strategic plan announced inMay 2016» . Competition On the corporate listing side, competition between exchanges for domestic issuers is rare. When a domestic issuer lists on another exchange, it tends to be on an American market rather than on another European stock exchange, in particular in respect of global companies and SMEs in the technology sector. As part of its Agility for Growth strategy, Euronext intends to attract issuers from new markets: ( i.e . Germany, Switzerland, Italy and Spain) and therefore will face the competition of local market operators. Euronext has opened in 2017 new offices in five European cities outside its core markets – in Germany (Frankfurt, Munich), Italy (Milan), Spain (Madrid) and Switzerland (Zurich) – to assist Tech companies in developing their business on a greater scale through capital markets. While competition in the cash trading market is relatively mature, in recent years Euronext has faced increased pressure on pricing and market share in equity options trading, in particular from new entrants to the market that have fee structures that are significantly lower than the Company’s and reduced cost structure aligned with their narrower service offering. The competition for proprietary real-time market data is still limited as trading participants prefer to receive and use market data from the home exchange rather than using substitute pricing. However, Euronext is experiencing an increasing pressure, both from a regulatory (MiFID II) and competitive perspective (alternative trading platforms, including MTFs such as BATS who focus on the most liquid blue chip stocks). Nevertheless Euronext believes that diversity in a wide range of stocks is Euronext’s strength in this increasingly competitive environment and will help Euronext retain its position as preferred data source. Interbolsa is the entity that provides post-trade services in Portugal (mainly settlement services and notary and central maintenance services). Interbolsa, as all CSDs in Europe, is facing increased regulatory pressure related to competition. Actually, according to the CSD Regulation, the creation of an integrated market for securities settlement with no distinction between national and cross- border securities transactions avoids distortions of competition. Considering also that, given the systemic importance of CSDs,

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2017 REGISTRATION DOCUMENT