2018 REGISTRATION DOCUMENT AND ANNUAL FINANCIAL REPORT

2018 Registration document and annual fi nancial report - BNP PARIBAS 53

2CORPORATE GOVERNANCE AND INTERNAL CONTROL

Corporate governance report

2. WORKS OF THE BOARD AND COMMITTEES IN 2018

2.a Works of the Board in 2018

Meetings Including extraordinary meetings Strategy seminar

11 1 97% 1

Investment stake/holding/ interest average

The Board of directors, which determines BNP Paribas strategy and overall business objectives based on proposals submitted by Executive Management and with the aim of promoting long-term value creation in the light of social and environmental issues:

■ looked at the best way of ensuring the efficiency, stability and visibility of corporate governance and, in particular, proposed to the Shareholders Annual General Meeting of 24 May 2018, that the BNP Paribas Articles of association should be amended to raise the age limit for executive corporate offi cers so as to prepare for the long- term succession process;

■ amended its Internal r ules and adopted the Suitability policy to replace the three existing procedures (number of directorships; confl icts of interest; identifi cation, selection and succession of d irectors ) under EBA Guidelines and the new provisions of the Afep-Medef Code;

■ co-opted Rajna Gibson-Brandon to replace Laurence Parisot, who resigned;

■ monitored the implementation of the 2017-2020 Transformation and Development Plan in terms of 2018 operating division results, the economic climate and the interest rate scenario. The guidelines for this 2017 -2020 Transformation Plan were implemented in 2020 through:

■ the good performance of growth-driving business lines,

■ the strengthening of compliance and control capacities,

■ a stringent risk management policy,

■ was informed of the impacts on Group equity of fi rst-time application of IFRS 9, replacing IAS 39;

■ monitored the changes in prudential requirements regarding capital and examined the provisional results of the Supervisory Review and Evaluation Process (SREP) and their impact on the solvency ratio;

■ approved the acquisition of Raiffeisen Bank Polska s core banking activities;

■ was informed of the continuing gradual divestment in 2018, based on market conditions, of the equity interest in First Hawaiian Bank;

■ approved BNP Paribas merger by absorption of BNP Paribas Commodity Futures Limited and Von Essen Bank GmbH;

■ monitored changes in the shareholding structure and share price;

■ discussed the Bank s performance relative to the competition and its balance sheet, based on the results available for the 2018 fi nancial year; reviewed the regulatory ratios of the main systemically important banks;

■ was advised of the situation regarding the Bank s systems in the Asia- Pacifi c territory;

■ was informed of the Bank s position in Turkey;

■ was informed of adjustments to the Bank s mechanism within the context of Brexit;

■ was informed of BNP Paribas policy on professional equality and equal pay;

■ reviewed the work of the Ethics Committee;

■ was informed of the results of the annual employee satisfaction survey (Global People Survey) and of the follow-up actions;

■ reviewed the recommendation of the Central Works Council on the Bank s strategic guidelines and issued a response to its observations;

■ examined the issuance amounts of debt securities in the form of senior and subordinated debt;

■ acknowledged the Executive Management s comments on the net margin generated on new lending in 2017 and in the fi rst half of 2018;

■ decided to pay additional profi t-sharing for 2017;

■ continued to track the amounts allocated to the various objectives of the Company s share buyback programme authorised by the Annual General Meeting;

■ authorised the delegations of authority for the issuance of debt securities, particularly for bonds and similar;

■ examined each of the related-party agreements entered into and authorised in previous years but still in force in the past year;

■ discussed the delegation of responsibility for internal control functions, on the basis of an update of the subsidiaries in question;

■ reviewed and approved the answers to written questions submitted by shareholders at the Annual General Meeting.

For the fourth time, SSM representatives from the ECB and representatives of the Autorité de contrôle prudentiel et de résolution (ACPR) attended a Board meeting (on 23 February 2018). They outlined their priorities for banking supervision for 2018, which was followed by an exchange of views with the members of the Board.

As in previous years, the Board of directors met on 19 December 2018 for a strategy seminar focused, inter alia, on the performance of the 2017-2020 strategic plan and the challenges for the Group s major business lines: Domestic Markets, Corporate and Institutional Banking and International Financial Services.