ABC arbitrage and ABC arbitrage Asset Management are limited companies with a board of directors. The board of directors determines the orientations of the activity and the general policy of the company and the group. He controls and directs the management. It approves the means necessary to achieve the strategic objectives that it defines. He oversees the implementation of the company’s management and control program and reports to the shareholders.

ABC arbitrage is a member of the association Middlenext (middlenext.com). ABC arbitrage’s board members regularly follow dedicated training sessions scheduled by Middlenext.

For information on the board of directors and corporate governance, consult the annual financial report.

The audit committee is responsible for the following tasks:

• It follows the process of preparing financial information and, where appropriate, makes recommendations to ensure its integrity;
• It monitors the effectiveness of the internal control and risk management systems, as well as, where appropriate, the internal audit, as regards the procedures relating to the preparation and processing of accounting and financial information, without that his independence be undermined;
• It issues a recommendation on the statutory auditors proposed for appointment by the general meeting. This recommendation to the Council is drawn up in accordance with regulation;
• it also issues a recommendation to the Board when the renewal of the mandate of the statutory auditor (s) is envisaged under the conditions defined by the regulations;
• It monitors the fulfillment by the statutory auditor of his mission and takes into account the findings and conclusions of the High Council of the Auditors following the controls carried out pursuant to the regulations;
• It ensures compliance by the auditor with the conditions of independence under the conditions and in the manner provided for by the regulations;
• It approves, the provision of services other than the certification of accounts in accordance with applicable regulations;
• He reports regularly to the Board on the performance of his duties. It also reports on the results of the audit certification mission, how this mission contributed to the integrity of the financial information and the role it played in this process. He informs him without delay of any difficulty encountered.

This Committee is composed of David Hoey and Xavier Chauderlot, permanent representative of Aubépar Industries SE. It is chaired by Isabelle Maury, an independent member of the Board.

The Strategy Committee makes recommendations to the Board of Directors on the overall strategic direction of the Company and the Group, the business development strategy and any other important strategic issues examined by the Board. It also examines in detail any major investment, acquisition, divestment or disposal projects submitted for its review and makes recommendations to the Board as to whether the projects should be approved or rejected.

This committee is made up of all the members of the Board of Directors. This committee is chaired by Dominique Ceolin.

As early as 2022, the Board of Directors turned its attention to the question of setting up a CSR committee, in line with recommendation no. 8 of the MiddleNext Code of Corporate Governance, which recommends that companies set up a committee specializing in Corporate Social Responsibility (CSR).

The creation of the CSR Committee was decided by the members of the Board of Directors in 2023, and the first meeting was held on October 13, 2023. Depending on the subject, this committee works in liaison with the other specialized committees. This first meeting provided an opportunity to define the committee’s orientations, such as the sharing of value and, in particular, the balance between the level of remuneration for all employees, the remuneration of the shareholder’s risk-taking and the investments required to ensure the company’s long-term viability. These guidelines have been approved by all members of the Board of Directors.

The members of this Committee are Dominique Ceolin and Isabelle Maury. It is chaired by Sophie Guieysse, an independent director.

The compensation policy for the chairman and chief executive officer of ABC arbitrage Mr. Dominique CEOLIN, breaks down as follows:

– A fixed amount controlled.

In respect of 2024, fixed remuneration of €210,000 per annum.

– Variable remuneration based on both objective (quantitative) and subjective (qualitative) criteria:

The quantitative criteria are :
indexed to the Group’s consolidated net income (“CGNI”), allowing a genuine convergence of interests with shareholders and calculated as follows:

* If the CGNI is less than €11 million: no variable compensation, other than that resulting from the company’s collective agreements, is determined;

* If the CGNI is between €11 million and €19 million: a variable compensation is calculated on a linear basis so that the sum of the total compensation up to a CGNI of €16 million is at most €275,000; and

* If the CGNI exceeds €19 million: 2,2% of the CGNI exceeding €19 million is added to the above amount.

The qualitative criteria used are:

1. Social and Societal Dimensions of Social, Societal and Environmental Responsibility (“CSR”). Qualitative assessment in 2024 based on the following indicators:

a. Non-chosen turnover of the Group’s workforce;
b. Involvement in the life of society outside ABC arbitrage (Mid Small Ecosystem, Governance, etc.);
c. Gender equality – current situation and measures implemented.

2. Environmental dimension of CSR – Environmental dimension with the implementation of CO2 measures on the activities of the ABC arbitrage group and the monitoring of the measures implemented.

3. Risk Management – Evaluation of the monitoring ratio of operational incidents and related explanations.

4. Scalability – Monitoring of the gross profit/employee ratio to ensure the Group’s efficiency.

Variation in the compensation may therefore depend in particular on the assessment of the quality of the executive’s work and behaviour within the Group.

The mandate bonus compensates for the responsibility and the precariousness of the function of mandatary, from the financial year 2022, the Board of Directors has set up a payment to the mandatary in two stages.

Firstly, an annual amount of €10,000 (ten thousand euros) will be paid as a mandate bonus at the end of the General Meeting to approve the accounts.

In a second time, in the event of non-renewal of the mandate or dismissal at the company’s initiative, the mandatary will receive an additional mandate premium calculated so that the sum of the mandate premiums received for the exercise of his mandate reaches €140,000 (one hundred and forty thousand euros).

In return, the agent expressly waives the right to claim any termination indemnity at the end of the mandate, whatever the cause, except in the case of termination under vexatious circumstances.

In accordance with recommendation 19 of the MiddleNext Code, no benefits will be granted in the event of termination or change of their functions.

Details of this policy and detailed figures for previous financial years are available in the Annual Financial Report, pages 20 to 27, and in the Board of Directors’ report on the remuneration policy for executive directors of ABC arbitrage.