technicolor - 2018 Registration document

3 RISKS, LITIGATION, AND CONTROLS RISK FACTORS

As in any organization, discrimination and harassment may occur. Beyond the fact that these behaviors are totally inacceptable, in creative environment and in industrial environment, such behaviors are also detrimental to the attractiveness and retention of talent, or the safety of the operations as well as to the reputation of the Group. Supply chains and logistics are becoming more complex, with increased number of stakeholders and levels of subcontracting. Detection and prevention of Human Rights violations in the chain is essential, together with remediation in case of occurrence. Risk Management Internal proactive policies to increase proportion of women at management position in the Group is the first lever. Developing the attractiveness (responsibility, engagement, development) allows to better absorb changes of regulation, compared to the competition, that may affect the Group’s talent diversity. Proactive actions toward education bodies and public authorities are also key levers to mitigate shortage of talent mix. Employee training is organized to raise awareness on harassment and discrimination and to prevent them. In certain countries, training sessions of self-defense are also organized for women. A whistleblowing procedure is open to receive harassment and discrimination alerts. Sanctions may be taken after investigation and conviction. A supplier’s risk mapping is maintained on a regular basis, together with physical on-site audits of suppliers presenting the higher risk (country and activity). The Group whistleblowing procedure will be opened to collect alerts in this area. Contracts with suppliers include terms and conditions forbidding Human Rights violation with sanctions, including immediate termination for the most important violations. Alternative suppliers are always considered to prevent production disruption. Legal compliance GRI [103-1 Socioeconomic compliance] [103-2 Socioeconomic compliance] Risk description The Group’s activities do not create any particular exposure to a specific sectorial regulation that could have an impact on its financial position. However, since the Group operates in a large number of countries, it must deal with various and complex regulations put in place by various national and international governments, authorities, and organizations. The laws and regulations to which the Company is subject apply to many different subjects, such as general business practices, competitive practices, anti-corruption, handling of personal data, consumer protection, corporate governance, employment laws, internal controls, local and international tax regulations and export compliance for high-tech products. For example, various anti-corruption regulations may apply to the Group, such as the French law of December 9, 2016 on transparency, anti-corruption and modernization of the economy and the U.S. Foreign Corrupt Practices Act. As it is listed on the French stock exchange, the Group is also subject to specific requirements and reporting standards.

Health and safety GRI [103-1 Occupational health and safety]

[103-2 Occupational health and safety] [403-5]

Risk description Most of the Group’s employees work in office buildings, so the environment, health and safety risks are limited on this perimeter. Regarding manufacturing sites, the Group operates mainly three DVD and Blu-ray TM replication sites (two main locations in Mexico and Poland, a smaller one in Australia) and one CPE (Consumer Premises Equipment) assembling site (Brazil). The distribution centers of the DVD Services Division are also an area of exposure to the environment, health and safety risks, they are located mainly in the U.S., Mexico, Canada, United Kingdom and Australia. Risk management Regular health & safety training are delivered to the Group’s employee as well as to the agency workers and contractors working in our locations to prevent injuries and accidents as part of global injury prevention programs. Injuries and severity rates are monitored with remediation actions. Industrial sites are regularly audited to review and assess health & safety risks and implemented preventing measures. For further details on health and safety actions conducted by Technicolor, see Chapter 5, section 5.2.5: “Safety at work” of this Registration Document.

Talent and Human Rights GRI [103-1 Training and education] [103-2 Training and education]

[103-1 Diversity and equal opportunity] [103-2 Diversity and equal opportunity] [103-1 Non-discrimination] [103-2 Non-discrimination] [103-1 Human Rights assessment] [103-2 Human Rights assessment] [103-1 Supplier social assessment] [103-2 Supplier social assessment]

Risk description Creative and innovative industries require an important diversity of talent to be able to differentiate from the competition: gender, culture, experience are key elements and must be present in the same location. Obstacles to diversity create a risk in the ability to compete or develop new products. This is valid from the software development to the Visual Effects or Animation industry, as our products and services are equally used or watched by women and men, around the world. Obstacles can be internal and internal policies ensure gender mix and equality. But they also can be external to the Group, preventing the recruitment of talent from diverse origins in a location. In a growing market, access to talent is key, and modification of these rules (e.g. such as immigration rules, national educational system gender mix, etc.) can create tensions in the countries where the Group operates.

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TECHNICOLOR REGISTRATION DOCUMENT 2018