2007 REGISTRATION DOCUMENT

2 ReportCORPORATE GOVERNANCEof the Chairman of the Board of Directors on the conditions for the preparation and organisationof the work of the Board and on internal control procedures implemented by BNP Paribas< Contents >Detailed and individual information on the remunerationpolicy for corporate officers is provided in section 2.1 of theRegistration Document which also refers to the AFEP-MEDEFrecommendations of January 2007 on the remuneration ofcorporate officers of listed companies.Share issue reserved for employees: newlegislation concerning employee incentiveschemes■The Board of Directors approved the terms and conditions of anew share issue reserved for employees and authorised an exceptionalpayment of additional collective profit-related bonuses for 2006 inaccordance with Act no. 2006.1770 of 30 December 2006.7. FINANCIAL STATEMENTS COMMITTEE■ The Financial Statements Committee was set up in 1994 and mostof its members have extensive experience and expertise in theareas of corporate financial management, accounting and financialinformation. In 2007, its membership was unchanged from theprevious year and included Louis Schweitzer (Chairman), PatrickAuguste, Denis Kessler and Hélène Ploix.■ The composition of the Committee (1) complies with French corporategovernance guidelines which recommend that at least two-thirds ofthe directors must be independent. No members of the Bank’s ExecutiveManagement sit on the Committee. Its duties and modus operandi areset out in the Board’s Internal Rules, which are periodically updated toreflect changes in legislation, regulations and best practices (2) .■ To ensure that the Committees’ knowledge remains fully up to date, itsmeetings include briefings on key issues, which are then examined anddiscussed in the presence of the Statutory Auditors. The informationpresented can be rounded out by meetings with managers of Groupfunctional and operating units, organised by the Board’s supportstaff for any Committee members who express a need for furtherclarification.■ The Committee met four times in 2007 and the rate of attendance was100%. Documentation on agenda items – presented in standardisedform – was distributed on average three to four days prior to eachmeeting, in line with French corporate governance guidelines.Review of the financial statementsand financial information■In accordance with the Board’s Internal Rules, in 2007 the Committeereviewed the financial statements based on the documents andinformation provided by Executive Management and the verificationprocedures carried out by the Statutory Auditors. In doing so, it verifiedthe relevance and consistency of accounting methods used in drawingup the Bank’s consolidated and corporate accounts. The Committeereviewed management accounting data by core business and reviewedthe impact of changes in the scope of consolidation. It was briefedby the Head of Group Finance-Development on changes in balancesheet and off balance sheet items between 31 December 2005 and31 December 2006.■ It reviewed draft press releases concerning the Group’s results priorto their presentation to the Board.■ It prepared the work and deliberations of the Board by scrutinisingissues requiring particular attention, inter alia the Group’s provisioningpolicy and the procedures used to determine the results of capitalmarkets transactions which were discussed in the presence of theStatutory Auditors.■ The joint meeting of the Financial Statements Committee and theInternal Control, Risk Management and Compliance Committeemainly discussed developments in the financial crisis that beganin the summer of 2007 and the Group’s policy for setting asideprovisions for credit risk. The meeting examined a joint memorandumsubmitted by the Heads of Group Finance-Development and GroupRisk Management.■ The Committee listened to a presentation from Group Finance-Development and the Statutory Auditors concerning key electionsfor the application of accounting standards and was briefed on thenature and impact of each of these elections on the Group’s results.■ When reviewing the financial results for each quarter or in the courseof its discussions of specific issues, the Committee interviewedthe Head of Group Finance-Development and the Head of GroupAccounting. During its review of the 2006 financial statements and ofthe results for the first nine months of 2007, it interviewed the Headof Group Finance-Development, without any member of ExecutiveManagement being present.■ When reviewing the financial results for each quarter, the Committeelistened to the comments and findings of the Statutory Auditors,without any member of Executive Management being present.■ The Committee was briefed – in the presence of the StatutoryAuditors – on the accounting internal control points identified aspart of the process of certifying the quarterly consolidation reportingpackage.■ The Committee reviewed the draft report of the Chairman of theBoard on internal control procedures relating to the preparation andprocessing of accounting and financial information, and recommendedit for adoption by the Board.■ At the end of each meeting, the Financial Statements Committeereported its findings to the Board of Directors, so as to providethe latter with full information and facilitate its deliberations anddecision-making.Relations with the Group’s Statutory Auditors (3)■The Committee received from each of the Statutory Auditors awritten statement of its independence vis-à-vis the conduct of theengagement.12345678910(1) AFEP-MEDEF 2003 (14.1).(2) AFEP-MEDEF 2003 (14.2).(3) AFEP-MEDEF 2003 (14.2.2).11502007 Registration document - BNP PARIBAS