AFD_REGISTRATION_DOCUMENT_2017

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CORPORATE GOVERNANCE Report on corporate governance

The Director’s Charter A charter sets out the rights, obligations and rules applicable to all members of the Agence française de développement’s Board of Directors, its audit committee or its special committees. All directors, both permanent and alternate, commit to adhere to the guidelines set out in this Charter (confidentiality, banking secrecy and the duty of circumspection, duty to inform, duty of vigilance, etc.) and to apply them when acting as individuals and as members of a company body called to make collective decisions. Conditions for the preparation and organisation ofbthe work of thebBoard of Directors Pursuant to ArticlebR.515-18 of the French Monetary and Financial Code, the Board of Directors decides the institution’s strategic orientations to implement the objectives entrusted to it by the State. It also approves the contractual targets and resources agreed with the State; the agreements referred to in ArticlebR.515-12 (managed at the State’s risk and on behalf of the State); financial aid as mentioned in Articles R.515-9, R.515- 10 and R.515-11 and the rules provided for by this last Article; agreements reached pursuant to the second, third, fourth and fifth paragraphs of ArticlebR.515-13 (managed on behalf of third parties); the annual amount of loans to be contracted by the Agency; the provisional statement of operating income and expenses; general aid conditions; the annual financial statements and management report drawn up by the Chief Executive Officer; purchases and sales of buildings; the opening and closing of foreign offices or representation offices; transactions in the Agency’s interests and arbitration clauses and the appointment of statutory auditors. The Board of Directors is informed of quality assessments, analyses and evaluations regarding the Agency and its operations. The Board of Directors’ operations are formally set out in the internal regulations, in accordance with ArticlebR.515-19 II of the French Monetary and Financial Code. The internal regulations define the procedure for consultation of the Board’s members by the Chair, remotely or in writing, for urgent deliberations. This procedure at the least defines a minimum consultation time, quorum rules and the right of any member of the Board and the Government Commissioner to oppose this consultation procedure. The specialised committees of the Board of Directors The Board of Directors may delegate a part of its powers, to the degree that it determines, to three specialised committees (for operations in the French Overseas Departments and Collectivities, for operations in foreign countries and for supporting the initiatives of non-governmental organisations). The specialised committee for activities in the French Overseas Departments and Collectivities includes three representatives of the French State, two of whom are appointed by decree of the Minister responsible for the French Overseas Departments and Collectivities and the third appointed by decree of the Minister of the Economy. The specialised committee for activities in foreign countries includes five representatives of the French State, two of whom are appointed by decree of the Minister of Foreign Affairs, a further two of whom are appointed by the Minister of the Economy and the fifth appointed by decree of

the Minister of Immigration and Solidarity-based Development. The specialised committee for supporting the initiatives of non-governmental organisations includes four representatives of the French State, two of whom are appointed by decree of the Minister of Foreign Affairs, the third appointed by decree of the Minister of the Economy and the fourth appointed by the Minister of Immigration and Solidarity-Based Development. In addition, each specialised committee includes two qualified experts appointed by the Board of Directors (one of whom sits on the Board) and one of the staff representatives on the Board of Directors chosen by these representatives. These specialised committees may be supplemented by one or several members of the Board of Directors at its own discretion. The specialised committee for operations in the French Overseas Departments and Collectivities and the specialised committee for operations in foreign countries are chaired by the Chair of the Board of Directors. The specialised committee for supporting the initiatives of non-governmental organisations is chaired by the Chair of the Board of Directors or by a member of the Board of Directors whom she appoints from among the representatives of the French State. For the members of specialised committees, other than the Chair and the members of the Board of Directors, an alternate is appointed under the same conditions as the permanent member. The term limit for members of the specialised committees and the conditions for their possible replacement are the same as those set for the members of the Board of Directors. The specialised committees may decide to submit any business within their remit to the Board of Directors. In such cases, they give the Board their opinion on the business referred to it. The Board of Directors may also delegate a part of its powers to the Chief Executive Officer, who reports back to the Board about the decisions that he made under this delegation. The Board of Directors appoints an Audit Committee and a Group Risk Committee, composed of three to five qualified financial and risk analysts. The Audit Committee provides the Board of Directors with an opinion on the financial statements, as often as required and at least once a year. The Risk Committee advises the Board of Directors on AFD Group’s overall strategy and risk appetite. The Agency borrows over the short, medium and long term in France and abroad, either through financial organisations, or by issuing bonds, notes, securities or any other debt instrument. It performs all financial transactions required for its activities. The Agency’s transactions are recorded in accordance with the rules concerning trade and in compliance with regulations governing credit institutions. A Government Commissioner, appointed by the Minister in charge of the Economy, performs a role for the Agency that is defined by ArticlebL.615-1 and ArticlesbD.615-1 to D.615-8 of the French Monetary and Financial Code. The audit of AFD’s financial statements is carried out by two statutory auditors, appointed pursuant to the provisions of ArticlesbL.511- 38, D.511-8, D.511-9 and D.612-53 to R.612-60 of the French Monetary and Financial Code. The statutory auditors are bound by the obligations set out in ArticlebL.511-38. ArticlebR.515-19 of the French Monetary and Financial Code stipulates that the Board of Directors must meet at least four times a year when convened by its Chair. During 2017, the Board of Directors and its specialised committees met 35btimes.

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REGISTRATION DOCUMENT 2017

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