Plastic Omnium - 2018 Registration Document

2 CORPORATE GOVERNANCE Report from the Board of Directors on corporate governance PLASTIC OMNIUM 2018 REGISTRATION DOCUMENT 55 Procedure for exercise of implementing powers of General Management Compagnie Plastic Omnium’s mode of corporate governance is suited to its specific characteristics and is based on an approach of continuous progress. The Board of Directors decided to renew the combining of the duties of Chairman and CEO. This decision was made following the recommendations by the Appointments Committee, in the best interest of the Company, and with the constant concern that the mode of governance chosen optimizes the Group’s economic and financial performances and creates the most favorable conditions for its long-term development. The quality and sustainability of this performance go hand in hand with the clear vision of the Group’s prospects, directly shared with the members of the Board. This vision carried by the senior managers of Compagnie Plastic Omnium is based on their perfect knowledge of the Group’s businesses and its local and international environment. The Company has to be responsive in a highly competitive international environment. Furthermore, this mode of governance is appropriate for the specific characteristics of Compagnie Plastic Omnium and the structure of its shareholding, composed primarily of the family group committed to the Group’s long-term development. Powers of the Chairman and Chief Executive Officer The Chairman and Chief Executive Officer has the broadest powers to act under any circumstances in the name of the Company, within the limits of the corporate purpose and subject to the powers that the law expressly grants to Shareholders’ Meetings and to the Board of Directors. The Internal Rules of the Board of Directors contain limits on his powers to take certain decisions which, on account of their purpose or their amount, are subject to the prior approval of the Board of Directors. Thus, the Board of Directors must approve material transactions likely to affect the Group’s strategy or significantly change its financial structure or scope of businesses. Guiding principles Independence Article 4.6 of the Internal Rules provides that every year the Board of Directors shall conduct an assessment of the independence of each director with respect to the criteria listed in the AFEP-MEDEF Code. The process for assessing the independence of directors was reviewed by the Appointments Committee at its meeting of December 13, 2018, then by the Board of Directors on December 14, 2018. The Appointments Committee’s meeting of December 13, 2018 and the Board of Directors’ meeting of December 14, 2018 reviewed on a case-by-case basis the situation of each of the members concerned with regard to the independence criteria mentioned in the AFEP-MEDEF Code. Besides the three executive directors, the following directors cannot be considered as independent: Éliane Lemarié, Permanent representative of Burelle SA which is itself a director, Jean Burelle, Félicie Burelle and Cécile Moutet, directors with family ties to one of the executive directors, Vincent Labruyère and Jérôme Gallot, directors of Compagnie Plastic Omnium for more than twelve years. At December 31, 2018, six directors are considered as independent; this represents a percentage of independent directors of 40%, in compliance with the provisions of the AFEP-MEDEF Code recommending a minimum threshold of one-third independent directors for controlled listed companies. Gender parity At December 31, 2018, the Board of Directors of Compagnie Plastic Omnium comprised 15 directors, of which 7 were women, a proportion of 47%. In addition, two of the three committees are chaired by a woman: the Appointments Committee and the Compensation Committee. Features of the Board of Directors, subject to approval of renewal of the terms of office set out above by the Shareholders’ Meeting of April 25, 2019 Reminder of the AFEP-MEDEF recommendations and the law Composition after the 2018 Shareholders’ Meeting Composition after the 2019 Shareholders’ Meeting Percentage independence 33.33% 40% 40% Feminization rate 40% 47% 47% Average age of Directors N/A 59.3 years 60 years Average term of office N/A 12.9 years 11.7 years Conflicts of interest Within the scope of the law and the rights and duties of directors as defined in the Internal Rules of the Board of Directors of Compagnie Plastic Omnium and in accordance with the AFEP-MEDEF Code, directors are subject to compliance with the rules applicable to the situation of conflict of interest and stock exchange Code of Ethics. Based on the declarations made by each director, the Board concluded that there was no conflict of interest. In particular, based on the work of the Appointments Committee, the Board of Directors found that there was no business relationship of any nature between the Plastic Omnium Group and any of its directors, which could lead to conflicts of interest. Information on corporate officers referred to in annex 1 of European regulation No. 809/2004 Existing family ties between corporate officers (Article 14.1 of the annex) Laurent Burelle, Jean Burelle, Paul Henry Lemarié, Éliane Lemarié, Félicie Burelle et Cécile Moutet are related. No conviction or incrimination of corporate officers (Article 14.1 of the annex) To the Company’s knowledge, none of its directors has been convicted of fraud, none has been involved as a corporate officer in a bankruptcy, receivership or liquidation in the past five years, and none has been the subject of any official charges or public sanctions pronounced by a