CORPORATE GOVERNANCE REPORT Compensation and benefits of executive corporate officers 5 Compensation must attract and retain people The performance criteria used to determine the compensation of with the best skills corporate officers are financial, operational and non-financial. Certain criteria are shared by Executive Board members because they reflect Adequate compensation, both fixed and variable, is essential to attract, the Company’s performance under the leadership of those executives. retain and motivate the best talent and thus guarantee the growth Other criteria are specific to each Executive Board member, which are of the Company. The compensation offered should be in line with determined based on their areas of activity. market practices for comparable companies. In order to ensure this, in compliance with the benchmark principal recommended by the AFEP- These criteria are regularly reviewed by the Nomination and MEDEF Code, the Nomination and Compensation Committee ensures Compensation Committee as well as by the Supervisory Board, in the regular appointment of various specialized and independent order to check whether they still reflect the Company’s strategy experts to undertake studies based on panels of companies of a and current position, the idea being to avoid retaining obsolete or similar size or companies that operate in the same activity sector as inefficient criteria while, in parallel, retaining a stability essential to Klépierre and that have a comparable international exposure. long-term performance assessment. Compensation must be based on performance, Compensation takes into account areas of responsibility in line with the interests of Klépierre and of its In accordance with paragraph 24.1.2 of the AFEP-MEDEF Code, shareholders the compensation of executive corporate officers is based on work In its compensation policy and in accordance with paragraph 24.1.2 performed, results obtained, responsibility assumed and the duties of the AFEP-MEDEF Code, the Company ensures that executive entrusted to the executive corporate officers. Changes in the size corporate officer compensation is aligned with the interests of of the Group and, consequently, areas of responsibility, influence Klépierre and of its shareholders. executive compensation and the Company’s competitive positioning if they are especially significant, result in structural changes and cause The compensation policy is thus primarily designed to reward the a profound change to the Company. performance of executive corporate officers, making it possible to align the interests of executive corporate officers with those of Compensation takes into account the Group’s social, Klépierre and of its shareholders. Accordingly, executive corporate societal and environmental goals officer compensation is very preponderantly subject to performance conditions, be it for the short-term variable portion or for the allocation Both the short-term variable portion and the long-term variable of performance shares. These performance conditions make it portion include non-financial criteria regarding social, societal and possible to evaluate how executive corporate officers create value environmental issues which are set in line with the Group’s goals in over various time frames. order to foster sustainable environmentally friendly development for the long term. KLÉPIERRE 2017 REGISTRATION DOCUMENT 243