Summary : Risks of prohibited and unethical practices in the conduct of business by employees or third parties could put the EDF group at risk of non-compliance with regulations, or even violations of human rights or fundamental freedoms.
Criticality : ● Moderate
The international nature of the Group’s activities and the strengthening of regulatory frameworks that punish unethical business practices, in particular, are likely to expose the Group, its employees or third parties acting on behalf of the Group to breaches of its ethical commitments or non-compliance that could damage its reputation or lead to civil or criminal sanctions or impact the Group’s financial performance.
Thirteen programmes have been set up to prevent risks relating to ethical breaches or non-compliance. These programmes cover the following topics
These programmes are detailed in section 3.3.2 “Ethics, compliance and human rights”.
Summary : Proceedings or litigation could have a significant financial or reputational impact on the Group.
Criticality : ● Moderate
In the ordinary course of its business, the EDF group is involved in litigation, the development or outcome of which could have a material adverse effect on its results or financial position.
In particular, the EDF group is subject in France to proceedings initiated by its competitors or by administrative authorities owing to its position in certain markets. Claims made against EDF could be considerable and could lead to the payment of compensation or a fine, or even lead to orders being issued that could have an impact on some of EDF’s activities. For example, in proceedings before the competition authorities in France or the European Commission, the amount of fines may be as high as 10% of the consolidated revenues of the company concerned (or of the group to which it belongs, as the case may be). The EDF group may also be involved in litigation relating to commercial or fiscal disputes with significant stakes, the outcome of which is inherently unpredictable.
The EDF group considers that overall, in all the countries in which it operates, it complies with all the specific regulations in force, and mainly those relating to the conditions under which it carries out its nuclear activities, but it cannot anticipate in this respect what the supervisory and administrative or judicial authorities, which are consulted, may decide. These risks are monitored with particular vigilance and give rise to the implementation of prevention policies (contractual policies, compliance policies, etc.). A procedure is in place to provide information to the Group’s Legal Department on actual or potential material litigation or other disputes and investigations.
The main proceedings in which the EDF group is involved are described in notes 17.3 , 5 and 1.4.1 of the appendix to the consolidated financial statements and in section 7.1.5 “Litigation”.
Summary : EDF is responsible for certain public service missions, the costs of which are covered by compensation mechanisms that may be incomplete or may be called into question.
Criticality: ● Moderate
In France, public service missions are assigned to EDF under French law (in particular Articles L. 121-1 et seq. of the French Energy Code), which also provides for compensation mechanisms in favour of EDF in respect of the discharge of such missions. The estimated amount of public service energy costs to be offset in France in 2022 for EDF amounts to €7,620 million (decision of the French Energy Regulation Commission of 15 July 2021 on the assessment of public service energy costs for 2022, as amended by the deliberation of 7 October 2021) (it must be noted that the repayment schedule came to an end and that the historical CSPE receivable was thus entirely reimbursed). The amounts of public service charges are set out in the Finance Act No. 2021-1900 of 30 December 2021 for 2022.
The occurrence of any of these events may have an adverse impact on EDF’s activities, results and financial position. Such situations could also call into question the Group’s ability to meet its CSR goals, mainly those aiming at helping fragile populations (see section 3.3.4 “Energy poverty and social innovation”).
