Universal registration document and annual financial report 2020

2020 Universal registration document and annual financial report - BNP PARIBAS 61

2CorPorate GovernanCe and internal Control

Report on Corporate governance

INTERNAL RULES OF THE BOARD OF DIRECTORS

PREAMBLE The rules concerning:

■ the Board of directors;

■ the members of the Board of directors, including their rights and obligations;

■ the Board of directors Committees;

are set by the statutory and regulatory provisions, the Company s Articles of Association, and these rules (in addition to these Internal rules of the Board of directors, there is the Policy on the suitability of Members of the management body and Key function holders mentioned in 1.3 below).

The Board of directors also takes into account the French market guidelines concerning corporate governance and, in particular, the provisions of the corporate governance Code for listed companies published by the French employers organisations Association Française des Entreprises Privées (Afep) and the Mouvement des Entreprises de France (Medef), hereinafter called the Afep-Medef Code, to which BNP Paribas (the Company ) refers.

The Board of directors is a collegial body that collectively represents all shareholders and acts in all circumstances in the corporate interests of the Company.

The Board of directors is assisted by specialised committees:

■ financial statements Committee;

■ internal control, risk management and compliance Committee;

■ corporate governance, ethics, nominations and CSR Committee; and

■ remuneration Committee;

as well as by any ad hoc committee.

PART ONE THE BOARD OF DIRECTORS, COLLEGIAL BODY

ARTICLE 1. DUTIES OF THE BOARD OF DIRECTORS

The Board of directors discusses any question coming within the scope of its statutory and regulatory duties and contributes to promoting the corporate values aimed, in particular, to ensuring that the conduct of BNP Paribas activities by its employees complies with the highest ethical requirements in order to protect the reputation of the Bank.

In particular and non-exhaustively, the Board of directors is competent in the following areas:

1.1. ORIENTATIONS AND STRATEGIC OPERATIONS The Board of directors:

■ determines BNP Paribas s business orientations and supervises their implementation by the Executive Management, taking the social and environmental challenges of BNP Paribas activities into consideration;

■ subject to the powers expressly allocated to the shareholders meetings and within the limit of the corporate purpose, it handles any issue concerning the smooth running of the Company and settles by its decisions any matters concerning it;

■ gives its prior approval with respect to all investment or disinvestment decisions (other than portfolio transactions) in an amount in excess of EUR 250 million, and any proposal to acquire or dispose of shareholdings (other than portfolio transactions) in excess of that threshold, submitted to it by the Chief Executive Officer. It is also regularly informed by the Chief Executive Officer of significant transactions which fall below this limit;

■ gives its prior approval to any significant strategic operation which falls outside the approved orientations;

■ promotes long-term value creation by BNP Paribas.

1.2. CODE OF CONDUCT The Board of directors and the Executive Management have developed a Code of conduct of BNP Paribas Group which defines the standards of conduct in line with the values and missions determined by the Bank. This Code, which shall be integrated by each business line and each employee, governs the actions of each employee and guides the decisions at every level of the organisation. For this purpose, the Board ensures the Executive Management implements this Code into business lines, countries and regions.

1.3. GOVERNANCE, INTERNAL CONTROL AND FINANCIAL STATEMENTS

The Board of directors:

■ appoints the Chairman, the Chief Executive Officer (CEO) and, on the recommendation of the latter, the Chief Operating Officer(s) (COO);

■ sets any limits to the powers of the Chief Executive Officer and of the Chief Operating Officer(s);

■ examines the system of governance, which includes, in particular, a clear organisational structure with well defined, transparent and consistent sharing of responsibilities, efficient processes to identify, manage, monitor and report the risks to which the Company is or might be exposed to; it periodically assesses the efficiency of this governance system and ensures that corrective measures have been taken to remedy any failings;

■ determines the orientations and controls their implementation by the actual managers of the monitoring measures in order to guarantee an effective and prudent management of the Company, including the segregation of duties in the organisation of the Company and the prevention of conflicts of interests;

■ ensures the fulfilment of the obligations which are incumbent on it concerning internal control, and, in particular, examines, at least twice a year, the activity and the results of the internal control;

■ approves the management report and the corporate governance report attached to it;

■ carries out the controls and verifications which it deems appropriate;

■ ensures that the Chief Executive Officer and/or Chief Operating Officer(s) implement a policy of non-discrimination and of diversity including gender balance in management bodies;

■ ensures the implementation of process for preventing and detecting corruption and influence-peddling for which it receives all the information required for that purpose;