Universal Registration Document 2022

Introduction

  • external growth transactions (investments, mergers and acquisitions), divestments, organic growth transactions, as well as stock exchange transactions, carried out by the Company or by one of its subsidiaries, which represent overall financial exposure for the Company or the Group exceeding €350 million; this threshold falls to €150 million for transactions not in line with the Company’s or the Group’s strategic policies;
  • coherent and inseparable industrial programmes of investments or works on existing assets, by the Company or one of its subsidiaries, exceeding €350 million per programme;
  • real estate transactions, carried out by the Company or one of its subsidiaries, exceeding €200 million;
  • certain financial transactions (long-term borrowings, debt management, securitisation or hedging transactions) whenever they exceed €5 billion or the equivalent in any other currency;
  • contracts and agreements (supplies, work or services) entered into by the Company involving amounts, including any necessary subsequent amendments, exceeding €350  million, or between €200 million and €350 million if these contracts relate to a new strategic policy or a new business line for the Group;
  • long-term contracts for the purchase or sale of energy, CO2 emission credits and quotas, by the Company or by one of its subsidiaries, for annual volumes or amounts exceeding 10TWh for electricity, 20TWh for gas (detailed information must also be provided on long-term gas purchase or sale agreements greater than 5TWh and less than 20TWh after the meeting of the Board of Directors) and €250 million for coal, fuel oil, and CO2 emission credits and quotas;
  • strategic agreements to be entered into by the Company constituting firm and irrevocable commitments relating to cooperation or partnerships with one or more foreign partners, in the nuclear industry involving significant transfers of intellectual property or technologies on the Group’s part and constituting major issues for the Group.

The Board of Directors determines the framework for the policy for the constitution, management and risk management of assets for hedging EDF’s nuclear commitments (dedicated assets), specifically ruling on asset/liability management and dedicated asset allocation strategy. If the Nuclear Commitments Monitoring Committee issues a negative opinion on a project to invest in unlisted assets for dedicated assets, the Board has sole authority to authorise the aforementioned project (see section 4.2.3.2 “Nuclear Commitments Monitoring Committee”).

In accordance with Article L. 311-5-7 of the French Energy Code, the Government Commissioner may oppose the investment decisions, the realisation of which would be inconsistent with the objectives of the strategic plan prepared by the Company or with those of the multi-year energy programme (see section 7.1.6.2 “Public service in France”).

(1) https://www.edf.fr/groupe-edf/edf-en-bref/gouvernance/conseil-dadministration.

4.2.2.4 Balance of powers

EDF’s articles of association state that the Chairman of the Board of Directors is the Executive Manager of the Company and holds the title of Chairman & Chief Executive Officer. The “non-separated” Executive Management structure is therefore set out in the Company’s articles of association.

Each year, when evaluating the functioning of the Board of Directors and the Committees, the Board of Directors assesses the organisation and balance of powers as set out in the Board’s Rules of Procedure, and in particular the limitations they place on the powers of the Chairman and Chief Executive Officer (see section 4.2.2.3 “Powers and duties of the Board of Directors” above). The Board has so far considered that the current arrangement ensures a satisfactory balance, in the interest of the Company, between the executive corporate officer and the Board of Directors, while preserving the necessary flexibility, efficiency and responsiveness with regard to the administration and management of the Company (see section 4.2.2.6 “Evaluation of the functioning of the Board of Directors and its Committees”).

The issue of the balance in the distribution of powers between the Chairman and CEO and the Board of Directors is also regularly discussed at the executive sessions (see section 4.2.2.3 “Powers and duties of the Board of Directors”).

Lastly, the Appointments, Remuneration and Governance Committee is responsible for reviewing and giving its opinion on potential situations of conflict of interest of which it is aware, or which might be reported to it, and for reporting on such conflicts to the Board of Directors (see section 4.2.3.5 “Appointments, Remuneration & Governance Committee”).

4.2.2.5 Evaluation of Director independence
Total number of Directors 18
Number of independent directors 5
Percentage of independent directors* 41,7%

* Excluding Directors representing the employees.

The AFEP-MEDEF Corporate Governance Code recommends that, in companies with a controlling shareholder, the proportion of independent directors should be at least one third of the Board of Directors and specifies that Directors representing employees are not taken into account in making this calculation.

The table below reiterates the independence criteria stated by the AFEP-MEDEF Code:

Independence criteria
Criterion 1: Employee or corporate officer in the previous five years

Must not be or have been within the previous five years an employee or executive officer of the Company, an employee, executive officer or Director of a company consolidated within the Company, an employee, executive officer or Director of the parent company of the Company or a company consolidated within this parent company.
Criterion 2: Cross Directorships

Must not be an executive officer of a company in which the Company, directly or indirectly, holds a Directorship, or in which an employee appointed as such or an executive officer of the Company (currently in office or having held such office within the last five years) holds a Directorship.
Criterion 3: Significant business relationships

Must not be a customer, supplier, commercial banker, investment banker or consultant of significance to the Company or its Group or for which the Company or its Group represents a significant portion of its activity. The evaluation of the significance or otherwise of the relationship with the Company or its Group must be discussed by the Board and the quantitative and qualitative criteria that led to this evaluation must be clarified in the annual report.
Criterion 4: Family ties

Must not be related by close family ties to a corporate officer.
Criterion 5: Auditor

Must not have been an Auditor of the Company within the previous 5 years.
Criterion 6: Period of office exceeding 12 years

Must not have been a Director of the Company for more than 12 years. Loss of the status of independent Director occurs on the date of the 12th anniversary.
Criterion 7: Variable remuneration or performance-based remuneration

Must not receive variable remuneration in cash or securities or any remuneration related to the performance of the Company or the Group.
Independence criteria
Criterion 8: Major shareholders

A Director representing a major shareholder of the Company or its parent company may be considered independent, provided this shareholder does not participate in the control of the Company. Nevertheless, beyond a 10% threshold in capital or voting rights, the Board of Directors shall systematically question the status of independent by taking into account the structure of the Company’s capital and the existence of a potential conflict of interest.