Cap Gemini - Registration Document 2016

CORPORATE GOVERNANCE AND INTERNAL CONTROL

2.4 Compensation of executive corporate officers

100% of the theoretical yearly cash compensation for a given to 93% of the theoretical cash compensation; year, and over the last 3 years this value has ranged from 60% the IFRS value of shares granted targets not to exceed around ◗ shares received under the 2009, 2012 and 2013 plans until the Mr. Paul Hermelin is required to hold all vested performance ◗ later of: plan), extended to four years (2012 and 2013 plan), and the end of the mandatory two-year holding period (2009 ❚ the expiry of his term as corporate officer. ❚ since then and in accordance with the recommendation of the ◗ one-third of vested shares vested. to hold shares that vest as a result of these grants was set at and similarly as of the July 2015 and 2016 grants, the obligation threshold had been attained at the time of the July 2014 grant shares on the delivery of the vested shares; Hermelin, he has not been required to buy a set number of given the significant number of shares held by Mr. Paul ◗ mandatory holding period. This prohibition is included in the share hedging transactions are prohibited before the end of the ◗ the first performance share grant plan in 2009. grant plan rules and applies to all beneficiaries. It applies since made in July in both cases; meeting. This was the case in 2015 and 2016 as the grant was Board of Directors’ Meeting at the end of July or the following at the same calendar periods and will be decided by either the Code, performance share grants will be performed from now on in accordance with the recommendations of the AFEP-MEDEF ◗ however a special grant was made in February 2016 targeting in July 2015, IGATE had just been bought not leaving enough former IGATE employees as at the time of the 2015 grant made and after having informed the HCGE of our intention, a special time to ensure a proper selection of the beneficiaries. Therefore limited population. Neither the Chief Executive Officer nor the grant has been made in February 2016 for this specific and grant. Group Executive Committee members were concerned by this Other items The Chairman and Chief Executive Officer: has waived his right to receive director’s fees since 2009; ◗ is not entitled to termination benefits; ◗ is not covered by a non-compete clause; ◗ compensation mechanism; does not benefit from a multi-year variable or deferred ◗ does not benefit from one off awards; ◗ does not have fringe benefits. ◗ performance shares representing at least 50% of shares must AFEP-MEDEF Code, the Board of Directors decided that vested than twice the theoretical annual salary (fixed and variable). Once be retained, where the amount of shares held represents less shares only applies to one third of shares vested. As this this threshold is reached, the obligation to retain performance

in 2015 following the closing of the plan are described in section The terms of the supplementary pension which rights were frozen was fully aligned with AFEP-MEDEF Code recommendations. 2.4.2 thereafter, being specified that when implemented the plan external hiring of an Executive Officer with the need to buy out A one off award, if any would only be applicable in case of an case, the award would be proportionate to the lost amounts. awards that would be lost following this hiring decision. In such Executive Officer for 2017 Fixed and variable compensation of the Chairman and Chief Following the principles just described, The Board decided, Committee, to leave Mr. Paul Hermelin’s theoretical compensation pursuant to the recommendation of the Compensation the fixed part of Mr. Hermelin, will remain at €1,452,000 for 2017. unchanged for 2017 at €2,420,000 (since 2013). This implies that component of Mr. Hermelin’s compensation for fiscal year 2017, The Board also set the procedure for calculating the variable as well as the personal strategic objectives adopted for the V2 defining the performance indicators underlying the V1 calculation, compensation will remain as follows: Accordingly, the operating indicators adopted for 2017 V1 revenue growth: 30% weighting; ◗ operating margin rate: 30% weighting; ◗ component. accelerated formula (upward or downward). past years, based on a comparison of actual audited and The level of attainment of these indicators will be determined as in budgeted Group consolidated results and will be subject ot the The personal strategic objectives adopted for 2017 V2 variable They relate to the operational transformation of the Group in 2017 compensation have been assigned an individual specific weight. around: in line with its strategic plan and associated indicators, in particular which 15% quantifiable); i) the Digital and Cloud strategic road map, 40% weighting (out of quantifiable); and management and mobility, 30% weighting (out of which 15% ii) the HR and delivery strategy around diversity, talent of which 20% quantifiable). iii) the growth of the North American market, 30% weighting (out such a way as they can be clearly assessed on objective grounds The Compensation Committee has formalized these objectives in objectives and the Board shared the same imperative when at the end of 2017 with a weight of 50% based on quantified subject to a quantitative evaluation in 2017. finalizing the objectives. Therefore 75% of the variable part will be by the shareholders at the Shareholders' Meeting to beheld in Executive Officer for fiscal year 2017 remains subject to approval 2018. Payment of the variable compensation of the Chairman and Chief pre-tax net profit: 20% weighting; ◗ free cash flow: 20% weighting. ◗

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Registration Document 2016 — Capgemini