Groupe Renault - 2020 Universal Registration Document

109 GROUPE RENAULT I UNIVERSAL REGISTRATION DOCUMENT 2020 01 INTERNAL CONTROL AND RISK MANAGEMENT GROUPE RENAULT GROUPE RENAULT: A COMPANY THAT ACTS RESPONSIBLY CORPORATE GOVERNANCE FINANCIAL STATEMENTS RENAULT AND ITS SHAREHOLDERS ANNUAL GENERAL MEETING OF RENAULT ON APRIL 23, 2021 ADDITIONAL INFORMATION At organizational and governance level, it is provided in particular by: a transversal global cybersecurity organization; P the Risk and Internal Control Committee; P Governance Committees coordinated by the IT Security P department, which carry out inspections to check the effective application of, in line with the Information Systems Security Policy and best practices. Given the Group’s main business trends, its digitalization and changing threats, the major actions to optimize risk management are currently focused on the following aspects: a major program to strengthen security at the Group's various P plants; the development of vehicle cybersecurity and associated services P in connection with the need to comply with the new regulations (UNECE) on vehicle cybersecurity; enhanced supervision (Security Operation Center – SOC) of P systems in all the Group’s domains (in particular IS/IT, vehicles, connected services, cloud infrastructure and plants); strengthening awareness, training and cybersecurity skills; P strengthening of the protection of the Group's systems/ P infrastructures (including those hosted in cloud mode). Risk of non-compliance with laws and regulations - medium risk As a result of its international activities, Renault is subject to increasingly numerous, complex and shifting laws and regulations, particularly in the areas of automotive manufacturing, the environment, competition, labor law and new technologies (see in particular chapter 1.6 “Regulatory environment” of this Document). The Group could therefore find itself exposed to a change in laws or regulations that were insufficiently anticipated or incorrectly taken into account by the existing management system described below. Moreover, the authorities or courts may also change the application or interpretation of existing laws and regulations at any time. These differences in anticipation or failure to account for such changes in laws or regulations could result, for the Group and its senior executives, in possible criminal, administrative or financial penalties, that could also lead, for the Group, to a change in its capacity to carry out its operating activities, its revenues, its profits or its image. Risk management Concerning such legal and regulatory changes, Renault requires its subsidiaries to comply with the regulations of the countries in which the company conducts its business and takes part in on going discussions with the national or regional authorities in charge of the specific regulation of the products in the automotive sector, in order to anticipate changes and guarantee compliance of the Group with laws and regulations. The Group uses a structured approach to analyze and ensure the robustness of its regulatory compliance in a sustainable and pro-active manner, over a scope of major regulated domains, including in particular: “competition”, “fight against fraud and corruption”, “environment”, “occupational health, safety, work environment”, “technical regulations”, "data protection", etc . This approach is managed by the Ethics and Compliance department, working closely with the Legal department, under the supervision of the Ethics and Compliance Committee (CEC). Legal risk - medium risk Groupe Renault is exposed to a legal risk induced by two components, the evaluation and potential impacts of which are detailed below. The Group uses a global assessment of these components in its criticality analysis. These are presented without prioritization in the following description. Disputes, governmental or legal proceedings, arbitration Renault is involved in various governmental, legal and arbitration proceedings as part of its activities in France and internationally. To the best of Renault’s knowledge, over the last 12 months there has been no dispute or governmental or legal proceeding other than those described below or arbitration process underway or likely to occur and that could have a significant impact on its financial position, activities or results. Each event was reviewed regularly in particular during approval of the financial statements. After seeking the opinion of the appropriate advisers, the Group sets aside any provisions deemed necessary to cover the estimated risks (see note 20 “Provisions” to the consolidated financial statements). It should be noted, however, that, concurrently with the works of the independent technical commission (“Royal” commission in 2016), the Direction Générale de la Concurrence, de la Consommation et de la Répression des Fraudes (DGCCRF) conducted investigations concerning the automotive industry. These investigations concerned the practices relating to the nitrogen oxide emissions (NO x ) of a dozen car manufacturers selling diesel vehicles in France, including Groupe Renault. The DGCCRF decided to communicate its conclusions on this matter to the public prosecutor who, on January 12, 2017, opened judicial investigations on the grounds of aggravated deception in respect of the substantive nature and controls conducted. Renault contests the existence of any infringement and intends to prove its compliance with French and European regulations in the legal investigation. Moreover, Groupe Renault, which at this stage is not a party to the proceeding, is therefore not in a position to assess the possible impact of this ongoing proceeding on the Group. Intellectual property Renault’s industrial know-how, innovations resulting from research, and the products marketed are the subject of patents, trademarks, designs and models filed to protect the Group’s intellectual property. As such, Groupe Renault files a significant number of patents, trademarks, designs and models in its area of activity each year (see chapter 1.4 of this Document). The major risk facing Groupe Renault in terms of intellectual property is the risk of counterfeiting, whether suffered or active.