Cap Gemini - Registration Document 2016

PRESENTATION OF THE GROUP AND ITS ACTIVITIES

1.7 Risk analysis

Competition

This integration process was notably implemented in 2015 on the acquisition of IGATE.

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factors

Reputation

both financial and operational. substantial resources, giving them significant scope for action, The IT consulting and services business is highly competitive. Major players, both French and international, operate with financial results. The Group’s inability to understand, satisfy or anticipate the current and future needs of our clients and prospective clients by launching relevant services on the market, could impact our Furthermore, the concentration of players in this market could offer opportunities or be prejudicial to the Group. Department (mergers and acquisitions) regularly assesses potential targets that could integrate the Group in the future. assess the weight, strengths and weaknesses of the main players. To monitor the competitive environment, the Development The Group monitors strategy in its various markets in order to The Group also seeks continually to ensure client satisfaction in order to build long-term relationships. A satisfaction measure is kept up-to-date throughout all contract phases (see Client risk below). lower than their acquisition cost (see Note 2 to Capgemini’s). and internal procedures. Unforeseen problems can generate higher integration costs and/or lower savings or synergies than initially forecast. If a material, unidentified liability subsequently comes to light, the value of the assets acquired may turn out to be maintain the client base intact, coordinate development strategy effectively, especially from an operating and commercial perspective, and dovetail and/or integrate information systems activity, particularly in the service sector, may prove to be a longer and more difficult process than predicted. The success of an external growth transaction largely depends on the extent to which the Group is able to retain key managers and employees, The implementation of external growth transactions, one of the cornerstones of the Group’s development strategy, can comport a number of risks. Integrating any newly-acquired company or integration of newly-acquired businesses. The successful integration of new businesses is also facilitated by the Group’s organization along geographic regions and business lines. The Group’s Legal Affairs Department is involved in the negotiation of the legal aspects of merger/acquisition projects. 1970s. Entrepreneurial spirit, managerial autonomy, and the principle of subsidiarity are crucial factors in the successful Capgemini has a wealth of experience in acquisitions, having carried out around 50 external growth transactions since the An integration manager is appointed for all acquisitions. He/she is involved from early on in the acquisition process and generally from the due diligence stage and, in all events, prior to signature of the contract. He/she has substantial technical experience and responsible for the implementation of appraisal systems and the regular review of management reports used to monitor the integration process and avoid any mismatch. the necessary authority and asserts his role as manager Risk management systems External growth Risk factors Risk management systems

Risk factors

on large-scale or sensitive projects, could negatively impact the Group’s image and credibility in the eyes of its clients, and by extension, its ability to maintain or develop certain activities. Intense media coverage of any difficulties encountered, especially When dealing with third parties and clients, the behavior of teams may be inconsistent with our principles (values, work methods, etc.) and could even present a danger to the Company if contrary to ethics or legislation. Finally, employee internet users could make negative comments on social media (Twitter, Facebook, etc.) on Capgemini’s performance, service offers or human resource policy, thereby challenge the cyber security of our internal IT systems and the systems we deliver to clients, and these cyber risks could have a negative impact on our reputation. tarnishing the Group’s reputation. New social media players implementation of the Ethics & Compliance Program covering all Group entities. explained in these two policies and follow an e-learning training course thereon. An organizational structure rolled-out in each country by an Ethics and Compliance Officer, monitors the embedded in Capgemini. A specific policy dealing with the prevention of corruption was distributed within the Group in 2011, followed by a second in 2012 covering anti-trust legislation. All new recruits are asked to undertake to comply with the principles ensuring their compliance by individuals in their Business Unit or who participate on joint projects. From this point of view, the Code of Business Ethics distributed in 2010 represents the continuation and formal documentation of cultural reflexes already firmly managers and employees continue to refer to these values and have committed to applying them personally on a daily basis and Compliance with clear principles of business ethics is firmly embedded in Capgemini’s culture. On its creation in 1967, the Group through its founder, Serge Kampf, identified seven core values which form the keystone of its identity (honesty, boldness, The Group decided many years ago to only employ individuals and have commercial relations in those countries satisfying a trust, freedom, team spirit, modesty and fun). Today, each of its certain number of criteria concerning business ethics and legal and physical security in the conduct of business, as well as tax compliance. Since 2011, the Group has implemented a solution for measuring and monitoring conversations on Group brands on social media. Internal social media are also monitored in order to best respond to employee comments. Finally, in order to strengthen governance rules covering the activities of Group employees on internal and external social media, a social media code of conduct was also drafted and is freely available on the Group’s website. business sector, the Group is frequently called upon by the media and the financial community to provide information on its activities. Listed on the Paris Stock Exchange and a global leader in its duly authorized by Group Management are permitted to speak on behalf of the Group. Therefore, to control and limit risks to its reputation, only persons Risk management systems

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Registration Document 2016 — Capgemini