Societe Generale SA

Since 2019, a Responsible Commitments Committee 'CORESP', chaired by the General Management, has been set up to reinforce the governance and take strategic CSR decisions, including climate-related ones. 2019 was also marked by the update and integration of the Environmental and Social risk management principles into the Group's new normative documentation, where the concepts of E&S risks and their governance have been more formally defined. [...] The Responsible Commitments Committee (CORESP), created in 2019, deals with topics related to the Group's commitments and normative framework in CSR (including CSR sector policies), culture and conduct, or other topics that have an impact on the Group's responsibility or reputation: it reviews issues with an impact on the Group's responsibility or reputation; approves the Group's new commitments; defines the normative framework, and examines culture and conduct topics. This committee is chaired by the CEO or, in his absence, by the Deputy CEO sponsoring CSR, and, depending on the agenda, is composed of the relevant Business and Service Units. The CORESP met 12 times in 2021, to address for instance: the update of sector policies, such as the oil & gas policy; the alignment of Societe Generale's own operations (setting new targets for its own operations); and a biodiversity roadmap was discussed. [...] Developed by cross-business line working groups under the supervision of the CSR Department, the E&S policies are approved by the Responsible Commitments Committee 'CORESP'. They detail the main E&S challenges and risks of the sectors covered, identify international standards for such sectors, and provide an analytical framework for client evaluations and dedicated transactions. As part of the Group's commitment to ongoing improvement, a sector watch assesses the need to update existing policies.

The monitoring of CSR target implementation relies on different things, amongst which: Target definition: ▪ The General Management, through two specialised committees, the Responsible Commitments Committee (CORESP) and the Group Strategic Committee (CSG), defines Societe Generale's strategic targets and non- financial performance indicators. Target monitoring: ▪ Business Units as well as the 2nd line of defence (Risk and Compliance Departments) have set appropriate CSR targets in their CSR roadmaps to implement the Group's CSR commitments. Progress against the various targets is assessed at least annually; ▪ Long term targets are more and more often supplemented by short-term and mid-term targets and some sector policies have been reviewed to explicitly mention related targets and deadlines (e.g., the oil & gas policy, updated in September 2023) ▪ Most of the targets (their definition, calculation methodologies and results) are verified annually by an independent verifier Furthermore, to underpin this approach, a specific programme was introduced to step up operational implementation of the transformation, called ESG by Design, Target accountability: The annual variable remuneration and long term incentives of the the CEO and Deputy-CEOs includes a 20% weighting to CSR criteria, with include quantifiable targets across 4 themes and including the roll out of the CSR strategy presented at the Capital Markets Day in September 2023 with reinfirced governance and compliance with the portfolio alignment targets described above. Furthermore, the weighting of CSR in the long-term incentives of the CEO and Deputy-CEOs was increased in 2023 from 20% to 33.3%, aligning with the Group strategy to align the lending portfolios with the goals of the Paris Agreement. [...] The Responsible Commitments Committee (CORESP), chaired by the Deputy Chief Executive Officer responsible for CSR, who oversees the Group's CSR commitments and standards, including as regards aligning its activity with climate targets. The Deputy Chief Executive Officer also examines any environmental and social (E&S) issues that could impact the Group's responsibility or reputation, when not covered by an existing General Management Committee.

On an exceptional basis, any deviation from this policy may be granted by a Société Générale group oversight Committee chaired by the senior management. [...] The Group applies the Equator Principles to the transactions and services falling in the scope of this initiative. The criteria above are applied in conjunction with, or in addition to the underlying standards of this initiative, including when applicable the IFC Performance Standards and the World Bank Group EHS Guidelines.

9. a) What are the public decisions targeted by your lobbying activities? Please detail them for the past two years, focusing on lobbying for human rights (including fundamental social rights), climate and governance, for the main jurisdictions in which you carry out your lobbying activities (including the EU, the US, emerging markets and other regions)? [...] Societe Generale regularly shares its expertise, whether technical or more strategic, in regulatory areas that could impact the banking or insurance industry or the Group's specialised activities (e.g. car leasing). This expertise is shared directly with public decision-makers or indirectly through interest groups that represent positions to influence public decision-making on matters important to the financial industry. We believe that this advocacy activity is beneficial in order to inform public decisions regarding the effects, both positive and negative, of certain regulations on our business model and costs, which determine our ability to finance the economy and to meet our strategic objectives in respect of our customers, our employees, our investors and all our stakeholders. [...] b) How do you monitor and ensure that your ESG objectives are aligned with the positions of the professional associations of which you are a member, as well as any potential discrepancies with your own positions? Do you publish a report in which you detail how the positions of your company and your professional associations are aligned, but also when they may differ from each other? [...] Societe Generale is a member of professional associations representing professional interests, at local and European level, in bodies related to the Group's financing activities or in order to promote the Group's position in broader bodies (e.g. associations representing private and foreign companies). It should be noted that membership of an association and contribution to the work of an association obviously do not equate to automatic support for all the positions taken by that association. In the event that a position does not comply with our ESG objectives, as in all cases of divergence between Societe Generale's positions and those of an association, Societe Generale may use its power of influence in order to change the association's position or to formally recognise differences in views between the members, and finally communicate its own divergent position to public stakeholders. We do not publish a report detailing how Societe Generale's positions are aligned or different from those of associations. However, each year in Q2, we update a global document describing Societe Generale's positions, allowing everyone to see our overall line in our various areas of intervention (Societe Generale Framework for Responsible Advocacy Activities - Memorandum, the 2023 version of which is yet to be published). As well as our positions, that same document describes the rationale for our interest representation activities, our governance, our permanent control system, our associations and our spending globally. [...] c) What resources do you allocate to your lobbying activities (human and financial resources) for all your markets around the world? [...] As indicated in its Public Memorandum, Societe Generale has a dedicated public affairs team (14 FTEs including administrative jobs), which is in charge of strategy, steering and representing the Group's interests in all its regions. Other representatives within the Group may intervene from time to time, in coordination with this team and in accordance with the lines defined by the Group. The amount of expenses allocated to advocacy results solely from two factors: - direct contributions: the costs of the above-mentioned persons, prorated according to the time they spend on advocacy, and - indirect contributions: the annual contributions of associations, prorated according to an advocacy percentage determined by each association. The overall Group mandate amount was €869,778 in 2021 and €834,770 in 2022. The Group does not authorise any political donations (€0) and did not use any external firm in respect of an advocacy mandate (€0), in 2020, 2021 or 2022.

The monitoring of CSR target implementation relies on different things, amongst which : Target definition: ▪ The General Management, through two specialised committees, the CORESP and the Group Strategic Committee (CSG), defines Societe Generale's strategic targets and non-financial performance indicators. Target monitoring: ▪ Business Units as well as the 2nd line of defence (Risk and Compliance Departments) have set appropriate CSR targets in their CSR roadmaps to implement the Group's CSR commitments. Progress against the various targets is assessed at least annually; ▪ Long term targets are more and more often supplemented by short-term and mid-term targets and some sector policies have been reviewed to explicitly mention related targets and deadlines (e.g., the oil & gaz policy) ▪ Most of the targets (their definition, calculation methodologies and results) are verified annually by an independent verifier Furthermore, to underpin this approach, a specific programme was introduced to step up operational implementation of the transformation: ESG by Design, And the annual variable remuneration and long term incentive of the board of directors includes some ESG criteria. On Climate change mitigation: In order to align our portfolios with trajectories compatible with 1.5°C climate targets, we align our origination policies and credit portfolio on various sector : - Coal : In 2019, the Group took its commitments up a level by announcing its target to reduce exposure to coal to zero by 2030 in EU and OECD countries, and by 2040 elsewhere. To achieve this, Societe Generale published a new sector policy for coal in July 2020. - Power : after having set a first target on CO2 emission intensity of the power production portfolio in 2020, the Group has set in 2022 a stricter target to reduce the CO2 emissions intensity by 2030. The goal will be achieved by adjusting the financed energy mix, reflecting both its decision to exit the coal sector and positioning itself as a leader in renewable energies. - Oil & Gas : In 2022, the group has updated its Oil and Gas E&S Policy and alignment target, to take into account the definition of exclusions of non conventional extraction techniques and the withdrawal from reserve-based lending for onshore assets in the Unites States.

The Group's Responsible Commitments Committee (CORESP) has been created in 2019 and is chaired by the Group CEO or the Deputy Chief Executive Officer supervising the control functions. The CORESP is composed of the heads of the Compliance Department, the Risk Division, the Communications Department, the CSR Department and the heads of the relevant Business Units and Service Units (depending on the subject matter). The roles of the CORESP are as follows: - take on new Group commitments, including CSR targets, or develop the normative framework (including sectoral E&S policies); - review very high-risk issues related to CSR, culture and conduct, ethics or reputation; - arbitrate complex transactions or customer cases that present a high risk in terms of the Group's reputation or non-compliance with its CSR, culture and conduct, ethics or reputation standards.

The monitoring of CSR target implementation relies on different things, amongst which : - Target endorsement: i. The main CSR targets have been validated and endorsed by the Chief Executive Officer. Overall results are presented to the Board. ii.The remuneration of senior executives is linked to collective targets since 2018. These include CSR targets, based on the Group's non-financial ratings (including asset manager RobecoSAM, rating agencies Sustainalytics and MSCI scores) which partially rely on E&S risk management scores and positive impact business scores (URD 2021, section 5.3.1, p.278). - Target monitoring: i. The achievement of the qualitative and quantitative CSR targets is coordinated by the CSR department, with the active contribution of the environmental and social experts from business and service lines (more information available under Principle 5). ii. The Group Responsible Commitments Committee (CORESP) has been created in 2019 and oversees the Group's CSR commitments and sectoral policies. The Group Risk Committee (CORISQ) monitors the risks associated with climate change since 2017 (URD 2021, section 5.3.1, p.277). iii. Business Units as well as the 2nd line of defence (Risk and Compliance Departments) have set appropriate CSR targets in their CSR roadmaps to implement the Group's CSR commitments. Progress against the various targets is assessed at least annually (URD 2021, section 5.3.8, p.299-300). iv.Long term targets are more and more often supplemented by short-term and mid-term targets (as detailed in the Group Climate Disclosure) and some sector policies have been reviewed to explicitly mention related targets and deadlines (e.g., the thermal coal policy) (Climate Disclosure and URD 2021, section 5.4.2, p.312). v. Most of the targets (their definition, calculation methodologies and results) are verified annually by an independent verifier (URD 2021, section 5.6, p.336)." [...] "The Group's Responsible Commitments Committee (CORESP) has been created in 2019 and is chaired by the Group CEO or the Deputy Chief Executive Officer supervising the control functions. The CORESP is composed of the heads of the Compliance Department, the Risk Division, the Communications Department, the CSR Department and the heads of the relevant Business Units and Service Units (depending on the subject matter) (URD 2021, section 5.3.1, p.278). The roles of the CORESP are as follows: - take on new Group commitments, including CSR targets, or develop the normative framework (including sectoral E&S policies); - review very high-risk issues related to CSR, culture and conduct, ethics or reputation; - arbitrate complex transactions or customer cases that present a high risk in terms of the Group's reputation or non-compliance with its CSR, culture and conduct, ethics or reputation standards. The CORESP has met 8 times in 2020 to address the following issues (URD 2021, section 5.3.7, p.295): the implementation of the E&S risk management framework, as well as the Group's Duty of Care Plan and the Modern Slavery Act statement; the update of sectoral policies, such as the defence and coal-fired power generation policies, including a commitment to phase out thermal coal extraction and power financing by 2030 in the EU and OECD countries, and by 2040 for the rest of the world; the plan to align lending portfolios with the Paris Agreement (setting targets for the gas and oil sector); sustainable IT infrastructures; biodiversity and the Soft Commodities Compact; the CFO Taskforce of the UN Global Compact; the commitment to reduce our upstream oil & gas portfolio by 10% by 2025 (compared to December 2019) and the decision to stop providing financing to US upstream onshore oil & gas sector. The CORESP reviewed this 1st PRB reporting and the key steps planned to pursue the implementation of the Principles for Responsible Banking. In addition, the Business Units and the 2nd line of defense are responsible for the operational implementation of the PRBs through the application and monitoring of the group's frameworks and targets.

The voting and engagement policy is reviewed annually to adapt tp any changes in laws and regulations, in governance codes, and in market practices over the past year. A dedicated internal governance committee (the Voting and Engagement Committee) meets twice a year to validate the voting and engagement policy and its roadmap. [...] To prevent these potential conflicts of interests, the following rules and measures are defined: - The engagement and voting policy is approved by the Voting and Engagement Committee, which is composed of members of various SGPWM's departments, CIOs and representatives of the Compliance and Internal Control Officer. - As with all our assets under management, the general rule for potential conflict-of-interests situations is to vote strictly in accordance with the current proxy voting policy. - In exceptional cases where the voting policy is inapplicable, the following procedure applies: I. The situation will be examined and presented to the Governance Committee II. Decision by the General Secretary III. If necessary, the SGPWM's CEO makes the final decision. [...] To provide its clients with the utmost transparency and comply with its legal obligations, SGPWM publishes an annual report on its website that presents the results of its engagement actions and the exercise of its voting rights (see section 2.3. Communication with relevant stakeholders). This report, which is usually made available in the first quarter of the year, is divided into the following two parts: 4.1. Reporting on engagement actions This section presents the number of companies with which SGPWM has exchanged over the past year, the various topics discussed and, where applicable, the impact that these exchanges may have had on voting at company general meetings. 4.2. Report on the exercise of voting rights This section includes details of voting decisions from the past general meeting season, including, among others: - The number of companies and general meetings on which resolutions were voted during the voting period; - The proportion of the general meetings on which SGPWM voted in relation to the total number of general meetings included in SGPWM's voting perimeter ; - The proportion of general meetings on which SGPWM voted in relation to the total number of general meetings for which SGPWM has voting rights; - Cases in which the principles of SGPWM's voting policy were not followed; - Cases of conflicts of interest arising during the voting period.

In particular, the review of corporate clients and transactions of the Shipping sector is also guided by the commitment made by the Group through the Poseidon Principles to disclose the carbon intensity of its shipping portfolio and measure its alignment with the IMO objective to reduce the total annual Greenhouse Gases (GHG) emissions of the Shipping industry by at least 50% by 2050 compared to 2008. Societe Generale results are published in the [annual Group Climate Disclosure](https://www.societegenerale.com/sites/default/files/documents/2020-10/climate-disclosure-report-20201027.pdf) [report.](https://www.societegenerale.com/sites/default/files/documents/2020-10/climate-disclosure-report-20201027.pdf)

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]We share technical, banking and insurance expert views with policy makers and groups that shape public policy positions on issues important to the financial services industry, among which sustainable finance regulations. We believe that this is beneficial for forming constructive consensus, and, in furtherance of this, we also participate actively in associative governance. Our membership and contributions to associations do not mean that we automatically support their positions, and it should be noted that in certain cases membership of an industry association is a legal requirement.
Our processes to ensure that our engagement activities are consistent with our overall climate strategy are as follows:
1. to ensure that our positions are driven by decisions taken by the business lines with the approval of the Chief Sustainability Officer (CSO).
In the Public Affairs Department, 2 FTEs are assigned to sustainable finance regulations and work with the CSO and impacted business lines, to ensure that positions are discussed and approved before any advocacy occurs. The Public Affairs Department also holds a Steering Committee comprising (i) all business and support functions with regulatory responsibilities (Risk, Compliance, Finance, CSO) and (ii) all public affairs officers. Every 2 weeks, CSR topics are thoroughly discussed.
2. to ensure that everyone advocating for the Group complies with our Public Affairs Strategy defined by the Group Public Affairs Department
Our internal Code specifies roles and responsibilities to manage obligations on advocacy activities wherever the Group is active. This governance relies on 3 levels: Heads of Business Units/Service Units (BU/SU), Advocacy correspondents (AC) and the Public Affairs Director. We ensure that any advocacy activity is approved by the Head of BU/SU and the Public Affairs Director thanks to the action and responsibilities of about 50 AC, who relay advocacy information from the BU/SU and control that no activity is performed without notifying the Public Affairs Department.
3. In case our trade associations' positions differ from our engagements and own advocacy
We would act on it through 3 means: a. try to influence the position of the organization towards a position closer to our engagements and needs; b. ask for the trade association to specifically state that not every member shares the associative position; c. alternatively, publish or make known our own position to public policy-makers.