Saint Gobain - Registration document 2016

6 CORPORATE GOVERNANCE

1. Composition and operation of the Board of Directors

section 1.4.2). To this end, the Committee has proposed to the Board an update of the Group procedure defining the companies during 2016 for their auditing assignments, as well as for their other services (see chapter 10, Fees received by each Statutory Auditor of the Group’s ‹ services that could be assigned to the Statutory Auditors and their network, to provide, in compliance with the new regulation, the competence of the Audit and Risk Committee to approve, under the responsibility of the Board of Directors, the services other than the legal certification of the accounts that can be assigned to them. and risk management, and the reference framework for Among its other activities, the Committee specifically reviewed the draft report of the Chairman on internal control internal control standards prepared by the Group. It examined a summary report prepared by the Statutory 2016, its 2017 audit program and its report on major fraud incidents. Auditors on cash management transactions, and the Internal Audit and Internal Control Department’s activity report for The Committee held one-on-one discussions with the Statutory Auditors, the Vice President – Financial Management, the Vice President – Treasury and Financing, Risks & Insurance, the Senior-Vice President in charge of Officer, in accordance with the recommendations of the AFEP-MEDEF Code. It did not call on outside experts to assist Internal Audit and Internal Control, and the Chief Financial in the fulfillment of its tasks. activities during the Board meetings of February 25, April 28, July 28 and September 22, 2016. The Committee reported to the Board of Directors on its Nomination, Remuneration and Governance

It reviews the external Statutory Auditors’ work plan and ‹ conclusions of their checks, as well as the post-audit report prepared by the Statutory Auditors concerning their main observations and the accounting options selected for preparation of the financial statements. It conducts the Statutory Auditor selection process, ‹ expresses an opinion on the amount of proposed statutory audit fees requested for performing tasks connected with a statutory audit, submits the results of the selection process to the Board and puts forward candidate Statutory Auditors for appointment by the General Shareholders’ Meeting. It approves, with regard to rules in force and in ‹ accordance with the procedures implemented within the Group, under the responsibility of the Board of Directors, the services other than the certification of the accounts they can be assigned to the Statutory Auditors and members of their network to be provided to Compagnie de Saint-Gobain and other Group entities. independence, the amount and breakdown of the fees Each year it reviews the Statutory Auditors statement of ‹ paid to them and to the members of their network by the Group over the past year, by category of service, as well as the percentage of these fees in their turnover, and reports to the Board its opinion concerning the Statutory Activities in 2016 The Audit and Risk Committee met four times in 2016, in February, April, June, July and September, with an attendance rate at these meetings of 94%. The following were the major topics of discussion: Detailed advance review of the corporate and ‹ management, the Finance Department and the Statutory Auditors prior to the meetings scheduled with the Board consolidated annual financial statements (February) and interim statements (July) and discussions with senior of Directors. On these occasions, the Committee discussed with the Statutory Auditors the main audit issues raised with the Finance Department during the accounts closing process, particularly the key risk exposures and material off-balance sheet commitments described in the Chief Financial Officer’s explanatory report to the Committee. The main points of the results of the statutory audit, as well as the accounting options applied, were also discussed. Review of activities relating to the mapping of primary ‹ risks carried out in 2016 by the Audit and Internal Control Department and discussion with senior management, the Finance Department and Audit and Internal Control. The status of asbestos litigation, in particular in the United ‹ States and France. The Committee regularly discusses in subsidiaries involved and for the Group, in order to present a report on this issue to the Board. detail with the Statutory Auditors the financial and accounting consequences of this litigation for the US Auditors’ independence.

Committee Composition

Mr. PHILIPPE VARIN Chairman (since June 6, 2013) Mr. BERNARD GAUTIER Member Ms. ANNE-MARIE IDRAC Member

Mr. PASCAL LAÏ Member (since June 2, 2016) Ms. OLIVIA QIU Member (since June 2, 2016)

The Nomination, Remuneration and Governance Committee includes three independent Directors out of four (75%), including its Chairman, as of February 1, 2017, and an employee Director in accordance with the recommendations of the AFEP-MEDEF Code. This Director is not included in the computation of the ratio of independent Directors, in accordance with the recommendations of that same code. No executive Directors sits on this Committee. Responsibilities (extracts from the Board’s internal rules) committee and a remuneration committee, provided for in the AFEP-MEDEF Code. The Committee fulfills the duties of both a nominations

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SAINT-GOBAIN - REGISTRATION DOCUMENT 2016

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