SUSTAINABLE DEVELOPMENT Act for People 4 A comprehensive set of rules to ensure compliance A «purchasing» department to structure shopping with Group commitments center procurement A set of internal procedures and best practices govern the activities In order to ensure proper management of the operational risks in order to ensure respect for regulations and local customs and linked to purchasing and to optimize the performance of the Group to prioritize the customers’ interests. They supplement and clarify in this area, a department dedicated to this area was created in the the principles set out in the Code. Thus they define the rules to be first half of 2014. With a six-strong team, and in cooperation with followed in order to limit and prevent risk situations related to the external providers, its primary responsibilities, in descending order following issues: of importance, are to: > conflict of interests; > optimize the purchasing processes; > confidentiality and observance of professional secrecy; > secure, evaluate, and monitor a specific pool of so-called > financial communication and media; “approved” suppliers; > privileged information and insider trading; > improve the operational margin. > fight against money-laundering and the financing of terrorism; It pays close attention to the responsible and sustainable nature of purchasing. Its areas of activity cover the operating and non-recurring > adherence to rules governing corruption; expenses for shopping centers as well as marketing budgets and > no political funding; overheads. > delegations of authority and signing authority; Its activity follows two fundamental principles: > gifts and invitations, received by employees and offered to third > neutrality, to ensure objective, fair, ethical, and transparent parties; processes; > protection and utilization of Company assets; > consideration of the life-cycle cost of purchased products. > adherence to procedures applicable to invitations to tender; Since the integration of the Corio assets in 2015, the Purchasing Department optimizes purchases in all 16 countries where the Group > whistleblowing; is present. In order to achieve this, it created the following action plan for 2017: > health and safety; > implementation of a common Supplier Relationship Management > prevention of acts of discrimination and harassment, respect for system (SRM) across the countries; privacy; > creation of an international purchasing coordination; > environmental responsibility. > implementation of dedicated purchasing expertise in the countries. An improved whistleblowing and fraud-risk Operating expenses experience a high level of scrutiny monitoring system (1) A whistleblowing procedure is also in place throughout Europe In 2017, Klépierre purchased around 300 million euros of services available to all employees. and supplies for the operational management of its shopping centers owned and managed in Europe. These operating expenses are This system, outsourced and independent of the Company, is available especially scrutinized. They are overwhelmingly passed to tenants 24/7 by phone, e-mail, or via a dedicated website. Anonymity is put in in rental charges. This is an important responsibility in the Group’s place when this is permitted by local regulations. All employees are dealings with its retailers, and pushes it to continually increase the made aware of this system. transparency and effectiveness of its budget management. No breach or violation of the ethical rules was reported through this Looking to achieve savings is a constant endeavor. For example, in system in 2017. 2017 the French subsidiary provided: The Group is regularly subject to external fraud attempts such as CEO > the roll-out of the framework agreement governing security and fraud and computer hacking attempts. Hacking is now the subject of safety in the shopping centers, which represents the top expense increased vigilance using audit and protection tools. Internally, access item; is managed by the system through authorized profiles and employees > The launch of a call for tenders to centralize the waste are made aware of these subjects through ongoing accessible training management service in the shopping centers; modules. > the carrying out of a national call for tenders for multi-technical Responsible purchasing maintenance in the centers; The Group's relationships with its service providers and suppliers are > the renewed roll-out of the gas supply contract for the shopping governed by the same concern for probity and integrity. Klépierre centers. endeavors to extend its principles of responsibility to its value chain, The risks related to operating expenses lie in the atomization of the since it plays a key role in safety issues and in the quality of the purchasing process (order or supply) at each shopping center and in shopping experience offered to all of its customers, both retailers and the identification of the suppliers providing services that can impact visitors. the business continuity of the center. These risks are addressed in particular through more stringent selection and approval of service providers and the signing of framework agreements and continuous on-site monitoring. (1) Excludes marketing budgets, taxes, management fees KLÉPIERRE 2017 REGISTRATION DOCUMENT 203