2018 Registration document and annual fi nancial report - BNP PARIBAS46
2 CORPORATE GOVERNANCE AND INTERNAL CONTROL
2
Corporate governance report
2.1.2 CORPORATE GOVERNANCE AT BNP PARIBAS
The Corporate Governance Code referred to by BNP Paribas on a voluntary basis in this report is the Corporate Governance Code for Listed Companies (revised in June 2018) published by the French employers organisations, Association Française des Entreprises Privées (Afep) and the Mouvement des Entreprises de France (Medef). BNP Paribas applies the recommendations of this Code, hereinafter referred to as the Corporate Governance Code or Afep-Medef Code, which can be viewed on the BNP Paribas website (http://invest.bnpparibas.com), the Afep website (http://www.afep.com) and the Medef website (http://www.m edef.com).
The special guidelines on the participation of shareholders at the Shareholders Annual General Meeting are laid out in article 18, Title V Shareholders Meetings of BNP Paribas Articles of association published in the Registration document and the annual fi nancial report, in the section Founding Documents and Articles of association. Moreover, a summary of these guidelines and a report on the organisation and proceedings of the Shareholders Annual General Meeting of 24 May 2018 are provided in the BNP Paribas and its shareholders section of said document.
In addition, BNP Paribas is governed in accordance with French and European banking regulations, and the guidelines issued by the EBA (European Banking Authority) and is subject to permanent supervision of the European Central Bank (ECB) pursuant to the Single Supervisory Mechanism (SSM).
1. PRINCIPLES OF GOVERNANCE In accordance with the proposal made by the Board of directors and approved by the Annual General Meeting of 24 May 2018, the BNP Paribas SA Articles of association have been amended in light of major
transformation issues within the banking sector to ensure effi ciency, stability and visibility of governance. Thus, i n the interest of the Company and the shareholders, the age limits for the Chairman and Chief Executive Offi cer were raised to 72 years of age for the Chairman and 65 years of age for the Chief Executive Offi cer, giving the Board of directors the option to extend their duties for an extra year. This option was extended, as for other corporate offi cers, to the Chief Operating Offi cer. This will give greater fl exibility when preparing for future transitions.
The Internal r ules adopted by the Board defi ne the duties of the Board and of its specialised C ommittees. They are updated periodically to comply with current laws, regulations and market guidelines, and to keep pace with best practice in the area of corporate governance.
The Internal r ules were extensively revised in 2015 to reflect the provisions of Directive 2013/36/EU on access to the activity of credit institutions and the prudential supervision of credit institutions and investment fi rms (hereinafter CRD 4 ), then amended in October 2016 with, in particular, the development of three procedures applicable to non executive d irector s (number of directorships; confl icts of interest; identifi cation, selection and succession of d irectors). In 2018, the Internal r ules were revised once again and the three existing procedures were replaced by a Suitability policy for Members of the management body and Key function holders, hereinafter Suitability policy . The proposed amendments comply with the Afep-Medef Code, revised in June 2018, EBA Guidelines on internal governance and on the assessment of suitability of members of the management body and key function holders (the Fit and Proper Guidelines ) published on 26 September 2017 and applicable from 30 June 2018 and Ordinance No. 2017-1162 of 12 July 2017.
A Group Code of conduct, approved by the Board of directors, was introduced in 2016.
Code of conduct (article 1.2 of the Internal r ules)
The Board of directors and Executive Management of BNP Paribas share the conviction that the success of the bank depends directly on the behaviour of each employee. [The Code of conduct] sets out the rules to uphold our values and perform the Bank s missions. 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 .
Note that the Internal rules reiterate and emphasise the collegial nature of the Board of directors, which jointly represents all shareholders and must act in the Company s best interest at all times. It details the Board responsibilities (article 1).
In addition, the Board of directors is backed by four specialised committees (the Financial Statements Committee, the Internal Control, Risk Management and Compliance Committee, Governance, Ethics, Nominations and CSR Committee, the Remuneration Committee) as well as any ad hoc committees. The Internal r ules detail each committee s missions, in line with the provisions of CRD 4 and EBA Guidelines. They provide for joint meetings between the Financial Statements Committee and the Internal Control, Risk Management and Compliance Committee and the Financial Statements Committee whenever required.
Neither the member of the Executive Management nor the Chairman of the Board of directors has sat on any Committee since 1997.
As far as the Board is aware, no agreement has been entered into directly, or through an intermediary, between on the one hand, one of the corporate offi cers (BNP Paribas corporate offi cers) and, on the other, another company in which BNP Paribas owns, directly or indirectly, over half the share capital (article L.225-37-4 paragraph two of the French Commercial Code), without prejudice to any agreements relating to current operations concluded under normal conditions.
The Internal r ules and Suitability policy mentioned above have been adopted by the Board of directors and are included in this report.
