HERMÈS - 2018 Registration document

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Corporate Governance

Supervisory Board’s report on corporate governance

to both the legal rules and to the principles set out in Article 18.4 of the AFEP-MEDEF Code revised in June 2018. Number of shares to be held by members of the Supervisory Board The rules of procedure require Supervisory Board members, except for the Employee representative, for whom this requirement is waived, to own a relatively significant number (200) of registered shares. The value of these shares based on the Hermès International share price at 31 December 2018 (€484.80) is equal to more than three years of directors’ fees. At its meeting of 25 January 2019 the Supervisory Board noted that all members of the Supervisory Board complied with this obligation. Role of the Supervisory Board The primary role of the Supervisory Board of a société en commandite par actions (partnership limited by shares) is tomaintain ongoing control over the Company’s management in accordance with the law and with the Articles of Association. In this respect, the Supervisory Board is res- ponsible for assessing the advisability of strategic choices; monitoring the correctness of Executive Management’s actions; ensuring equal treatment of all shareholders; and verifying the procedures implemented by the Company to ensure the fairness and accuracy of the parent com- pany and consolidated financial statements. To fulfil these obligations, every year, the Supervisory Board presents any comments it may have on the parent company and consolidated financial statements, decides on the proposed allocation of net income, and provides all recommen- dations and authorisations. The Supervisory Board describes the due diligence procedures it carried outduringtheyearended31December2018inareportpresentedtothe General Meeting called to approve the financial statements (page 396). The functions exercised by the Supervisory Board do not entail any inter- ference with the Executive Management, or any liability arising from the management’s actions or from the results of such actions. In accordance with Article L. 226-10-1 of the French Commercial Code ( Code de commerce ), the Supervisory Board also presents this report on corporate governance. As an extra-statutory mission, the rules of procedure call for the Board to approve or refuse an Executive Chairman’s acceptance of any new appointment within a listed company. At its meeting of 26 January 2018 the Supervisory Board approved the acceptance by Mr Axel Dumas of a directorship at L’Oréal. Duties of the Chairman of the Supervisory Board and activity report – Communication with shareholders At its meeting of 20 March 2018 the Supervisory Board made its Chairman responsible for communicating with shareholders on behalf of the Board, with a view to: s s explaining the positions taken by the Supervisory Board in its areas of competence (particularly with regard to governance and executive compensation), which were previously the subject of a communication; 3.1.4.8 Functioning of the Supervisory Board

s s ensuring that shareholders receive the information they expect from the Company. The Chairmanmay seek the assistance of internal experts in these areas (in particular Ms Carole Dupont Pietri, Group Financial Operations and Investor Relations Director or Ms Nathalie Besombes, Corporate Law and Stock exchange regulations Director, Supervisory Board Secretary and Securities Compliance Officer). The Chairman must report annually to the Supervisory Board on the exe- cution of his or her duties. No additional compensation is allocated to the Chairman for executing these duties. In early 2019, the Chairman reported to the Supervisory Board on the performance of his duties in 2018. In particular, he stated: s s having answered questions from individual shareholders during and after the General Meeting; s s having answered questions from institutional shareholders; s s having responded to questionnaires from stakeholders. In 2018 the Board did not give the Chairman of the Supervisory Board any duties other than those conferred by law. Supervisory Board’s master file Since 2011 a “master file” has been provided to the members of the Supervisory Board. It has been available since 2016 on the Board’s collaborative platform, “Herboard” (see below). It currently contains the following sections: s s a list with contact details of themembers of the Executive Committee, Supervisory Board and Board Committees and the Board Secretary; s s a table of the dates of terms of office; s s the Supervisory Board rules of procedure; s s the Audit and Risk Committee rules of procedure; s s a calendar of closed periods applicable to Permanent Insiders; s s the AMF guide on ongoing information and managing inside information; s s regulations regarding the declaration obligations of Senior Executives and registration of shares; s s principles governing the distribution of directors’ fees; s s rules on the reimbursement of expenses; s s certification and summary of Corporate Officers’ civil liability insurance; s s the three most recent Registration Documents; s s the convening notice for the last General Meeting; s s a summary of the results of the last formal three-year evaluation of the Supervisory Board; s s presentations made during site visits since 2011; s s the CAG-CSR Committee rules of procedure; s s the Hermès Group Code of Stock Market Ethics;

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2018 REGISTRATION DOCUMENT HERMÈS INTERNATIONAL