3 _103 2023 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN 3 CORPORATE GOVERNANCE REPORT Supervisory Board practices – Activities in 2023 3.2.6 Review of Supervisory Board members' independence and any conflicts of interest The Supervisory Board has chosen to refer exclusively to the criteria listed in the AFEP/MEDEF Code for its assessment of its members' independence. The AFEP/MEDEF Code recommends that a majority of the members of the Supervisory Board should be independent and without any vested interests (i.e., with no relationship of any kind whatsoever with the Company or its management which might risk coloring the member's judgment). The Supervisory Board's internal rules also explicitly stipulate that its members are required to inform the Supervisory Board of any potential or existing conflict of interest and are banned from taking part in the discussion and voting on the matters concerned. In the first phase, the Compensation and Appointments Committee ensures that each Supervisory Board member has formally declared, in relation to the provisions and abstention obligations of the Board's internal rules(1), that: ● they have no close family ties with their fellow Supervisory Board members; ● they have not, in the past five years, been (i) convicted of fraud, (ii) associated with a bankruptcy, receivership or liquidation, (iii) the subject of any official public incrimination and/or sanctions by statutory or regulatory authorities or disqualified by a court from acting as a member of the administrative, management or supervisory bodies of an issuer or from acting in the management or conduct of the affairs of any issuer; ● they do not have a service contract with the Company or any of its subsidiaries(2); ● they have not been selected to serve as a corporate officer pursuant to any arrangement or agreement with a principal shareholder, customer, supplier or other stakeholder; ● to the best of their knowledge, there are no restrictions on the disposal within a certain period of time of their Michelin shares, except for those resulting from insider dealing rules; ● to the best of their knowledge, there are no conflicts of interest between their obligations towards the Company in their capacity as corporate officer and their personal interests and/or other obligations. Where applicable, the Committee also checks any notifications given to the Board by its members. In the second phase, to complete the earlier statements and observations, the Committee: ● checks that none of the Board members had been an auditor of the Company during the past five years; ● reviews the period served on the Supervisory Board by members since they were first elected, in particular for members who have served on the Board for 12 or more years; ● checks that no Board member has received any variable compensation in cash or shares or any other performance–based compensation from the Company or the Group(2). In addition, the Committee examines whether any Board member: ● is or has been in the past five years an employee or executive officer of the Company, or an employee or executive officer of its parent or a company that the latter consolidates; ● is an executive officer of a company in which the Company holds a directorship, directly or indirectly, or in which an employee appointed as such or an executive officer of the Company (currently in office or having held such office for less than five years) is a director; ● is a customer, supplier, investment banker or commercial banker: ● that is material to the Company or a Group company, or ● that depends on the Company or the Group for a significant part of its business. In the third phase, the Committee reviews the situation of Supervisory Board members who may personally conduct significant amounts of business with the Company or be involved with undertakings that may maintain significant business relations with the Company. In each case, the Committee starts by examining the nature of the Supervisory Board member's duties in the undertaking concerned, particularly whether they hold a non-executive position such as member of the Board of Directors or Supervisory Board, whether they are qualified as independent by that undertaking and whether they share any cross‑directorships with an executive officer of the Company. Where a Board member holds an executive or management position, the Committee examines the nature and scope of the member's duties and, if the undertaking is a material competitor, customer or supplier of the Company, assesses whether the position may give rise to a conflict of interest between that undertaking and the Company. (1) When the Compensation and Appointments Committee assesses the independence of one of its members, that member does not take part in the Committee’s discussion and analysis of his or her situation nor in the Supervisory Board’s decision regarding his or her independence. (2) Excluding the Supervisory Board members representing employees.
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