5452019 Universal registration document and annual financial report - BNP PARIBAS

7 a Committed Bank: information ConCerninG the eConomiC,

soCial, CiviC and environmental resPonsiBility of BnP PariBas

7

Our social responsibility: developing and engaging our people responsibly

A COMPETITIVE COMPENSATION POLICY The Group s compensation policy is founded upon principles of fairness and transparency, which are notably supported by a single annual compensation review process of all employees. The principles on the composition of compensation and its evolution are common throughout the Group and consistent with the objectives of risk management.

The data on the average remuneration and the median remuneration of employees are available in Chapter 2 (Table Remunerations multiples and changes ) based on employees of BNP Paribas (SA) (France and branches) in accordance with applicable laws.

A compensation policy aligned with regulatory changes(1)

The Group s compensation policy, applicable to all branches and subsidiaries, including those outside the European Union, aims to ensure consistency between the behaviour of employees whose professional activities have a significant impact on the Group s risk profile and the Group s long-term objectives, particularly in terms of risk management. Since 2009, this policy has continued to help improve governance, identify employees who may be characterised as Material Risk Takers (MRT) and apply the special provisions on the award and terms of payment applicable to their variable compensation. The compensation policy and principles of employees identified as MRTs are published annually in a report posted on the BNP Paribas website (http://invest.bnpparibas.com) before the Annual General Meeting of Shareholders(2).

The compensation policy also complies with applicable regulations, notably (i) regulations in relation to customer protection (MiFID 2(3) or European Banking Authority guidelines on compensation practices in relation to the sale of Retail Banking products) for employees working directly or indirectly with customers, (ii) sector-specific provisions (asset management with AIFMD and UCITS, and insurance with Solvency II), or (iii) business-specific regulations with the application of the provisions of French banking law and the Volcker rule applicable to market participants.

It complies with the laws and regulations in force, including any provisions on minimum wages, which are applied according to employees level of experience, expertise and market practices.

A competitive and fair compensation policy

In 2019, for retention purposes, the Group awarded for the seventh consecutive year to over 7,330 key employees(4) a three-year retention plan (maturing in June 2022), known as the Group Sustainability and Incentive Scheme (GSIS), of which 20% of the initial allocation is related to the Group s CSR performance objectives, based on the four pillars of the Group s CSR strategy(5), while the rest is indexed to its operational performance.

BNP Paribas is continuing to increase its attention to equal treatment for all, particularly when it comes to gender equality. Since 2016, a new monitoring indicator on the consistency of compensation granted to men and women has been included in the annual compensation review process, for all the Group s businesses and functions. For a number of years, measures may also be taken locally to reduce any pay gap between men and women. In 2019, BNP Paribas SA set aside a EUR 10 million budget spread over three years to address possible gender differences in annual compensation. In addition, the budget provided by subsidiaries in France was stable at around EUR 1.3 million.

For the first time in 2019, BNP Paribas and its different entities in France, published their gender equality index. The scores earned by the Group s banking and insurance entities(5), which represent more than 45,000 employees, are among the best in the industry and well above the statutory minimum, demonstrating the Group s long-term commitment to professional gender equality.

In France, the Group associates its employees with its performance as part of profit-sharing and incentive mechanisms. For 2019, EUR 160 million will be distributed to the estimated 66,305 beneficiaries of entities that are members of the Group profit-sharing agreement (compared with EUR 147 million to 67,269 beneficiaries in 2018). This initiative coincides with SDG 8: decent work and economic growth.

(1) European Directive CRD 4 of 26 June 2013, as transposed into French law in the French Monetary and Financial Code, as well as Delegated Regulation 604/2014 on the criteria for identifying risk-taking employees (MRTs) and the European Banking Authority guidelines on sound compensation policies of 27 June 2016.

(2) The next Annual General Meeting is scheduled on 19 May 2020.

(3) Markets in Financial Instruments Directive.

(4) Key employees: senior managers, high-potential employees or key local resources.

(5) For the 2016 plan, payable in 2019, the achievement of 8 of the 9 CSR criteria defined when the plan was allocated triggers the payment of the amount initially allocated for CSR to the plan beneficiaries, in accordance with the plan s regulations

(6) Scope: Entities with more than 1,000 employees.