INCLUDING THE ANNUAL FINANCIAL REPORT AND MANAGEMENT REPORT INCLUDING COMPONENTS OF THE STATEMENT OF NON-FINANCIAL PERFORMANCE

The original French-language version of the Universal Registration Document was filed on 15 March 2024 with the Autorité des Marchés Financiers (AMF) in its capacity as competent authority in respect of Regulation (EU) 2017/1129, without prior approval in accordance with Article 9 of said regulation.

The original French-language version of the Universal Registration Document may be used for the purposes of an offer to the public of financial securities or the admission of financial securities to trading on a regulated market if it is supplemented by a securities note and, if applicable, a summary and any amendments made to the Universal Registration Document. The resulting combined document is approved by the AMF in accordance with Regulation (EU) 2017/1129.

The information included in both of those registration documents, other than the information mentioned above, has been replaced and/or updated, as applicable, by the information included in this Universal Registration Document.

This document is a free translation into English of the original French “Document d’enregistrement universel”, referred to as the “Universal Registration Document”. It is not a binding document. In the event of a conflict of interpretation, reference should be made to the French version, which is the authentic text.

“Sopra Steria’s ambition is to become a compelling alternative to global providers for major European clients”

Pierre Pasquier

Chairman and Founder of Sopra Steria Group

We are living at a time of considerable upheaval that is affecting all aspects of our lives: political, international, social, environmental, and societal. The development of digital technology is one of the key drivers of this change and heralds yet more major change to come.

As a major player in the European tech sector, Sopra Steria plays an important role in the development of digital technology. Our mission is to guide our clients, partners and employees towards bold choices, building a positive future by making digital work for people. Drawing on our founding values and corporate culture, we have adopted a responsible approach to digital technology that takes into account its impacts on all our stakeholders. That means digital ethics and sovereignty are priorities. We strive to continuously improve our environmental footprint by reducing our emissions. We are committed to work every day to uphold workplace gender equality, inclusion and diversity.

The strategic review we kicked off at the end of the public health crisis highlighted the need to speed up our internal transformation to adapt the Group to the environment in which it now operates. We are firmly committed to this process.

We have begun to streamline our range of services and solutions so that we can serve our clients even more effectively as they navigate the digital transition. In particular, we are expanding our consulting business and upgrading our operating model to better leverage our tech expertise.

Our external growth strategy is aimed at consolidating our position in markets we see as strategic for Sopra Steria in Europe. Through acquisitions over the past two years, we have significantly expanded our presence in Benelux and considerably strengthened our position in defence and security as well as securing a promising new foothold in the space segment.

Thanks to the changes that are underway, Sopra Steria’s ambition is to become a compelling alternative to global providers for major European clients, particularly in the public sector and in defence, aeronautics and financial services.

As we look ahead to the rest of 2024, I am confident the Group will be able to continue with its development. Sopra Steria is poised to leverage future growth in the digital space to continue gradually ramping up our performance towards the highest industry standards.

Sopra Steria, a major player in the European tech sector recognised for its consulting, digital services and software development, helps its clients drive their digital transformation and obtain tangible and sustainable benefits.

It provides end-to-end solutions to make large companies and organisations more competitive by combining in-depth knowledge of a wide range of business sectors and innovative technologies with a fully collaborative approach.

Sopra Steria places people at the heart of everything it does and is committed to putting digital to work for its clients in order to build a positive future for all.

1_Alternative performance measures are defined in the glossary of this document.

2_Dividend proposed for approval at the General Meeting of 21 May 2024

See Chapter 5 for more information

See Chapter 1 for more information

Technology serves as a gateway to infinite possibilities. As fascinating as this never-ending stream of innovations is, it also raises questions as to what is actually behind the frantic race for novelty and change.

Solutions are never straightforward or obvious, and there is certainly never just one way of doing things.

At Sopra Steria, our mission is to guide our clients, partners and employees towards bold choices to build a positive future by putting digital technology to work in service of humanity.

Beyond technology, we set great store by collective intelligence, in the firm belief it can help make the world a better place.

Together, we are building a highly promising future by delivering tangible benefits: sustainable solutions with positive impacts that take full account of interactions between digital technology and society. There’s still so much more we can achieve together.

Dare together

At Sopra Steria, we strive to create a stimulating, group-oriented environment inspiring free thinkers to engage in open, frank discussions. Our goal is to foster the development of skills and entrepreneurship in a community driven by a desire for collective success.

1_ Source: Gartner – IT services 2021-2027, updated Q4 2023, at constant US dollars

2_ Systems integration and third-party application maintenance

1_ AI: Artificial intelligence

2_ IoT: Internet of things

3_ GPTW: Great Place To Work

4_ GHG: Greenhouse gas

See Chapters 1 and 4 for more information

Directors’ attendance rate

Members at 21 February 2024

1_ 6/15 women – 9/15 men

2_ 10 out of 15 Board members qualify as independent based on the AFEP-MEDEF Code’s requirements

See Chapter 3 for more information

18 Members

Management Committee

The Management Committee consists of the Executive Committee members and 44 operational and functional managers. 9 of its members are women.

See Chapter 1 for more information

Sopra Steria’s strategy is built around its independent corporate plan focused on sustainable value creation for its stakeholders. This Europe-wide corporate plan is underpinned by expansion through organic and acquisition-led growth. Its goal is to generate substantial added value by leveraging a comprehensive range of end-to-end¹ solutions. Our ambition is to be the partner of choice in Europe for major public administrations, financial and industrial operators and strategic businesses, when they are looking for support with driving the digital transformation of their activities (business and operating model) and their information systems, and preserving their digital sovereignty.

Sopra Steria plans to expand its development of digital services and solutions in Europe and focus its investments on consulting and digital technology in its strategic verticals: financial services, defence & security, aeronautics, space and the public sector.

The Group’s ambition is to become a compelling European alternative to global providers, particularly with regard to issues of digital sovereignty, for major European clients in its strategic verticals.

Sopra Steria’s corporate plan is set within an upbeat market for digital services in the medium term, boosted by demand for digital transformation on the part of businesses and institutions looking to optimise their processes and increase their resilience.

See Chapter 1 for more information

The most material risks specific to Sopra Steria are set out below by category and in decreasing order of criticality (based on their probability of occurrence combined with the estimated severity of their impact), taking account of the mitigation measures already implemented. This presentation of residual risks is not intended to show all of Sopra Steria’s risks.

The internal control system and risk management policies implemented by the Group aim to lower the probability of occurrence of these main risk factors and their potential impact on the Group.

Each of these risk management policies is described in detail in the “Risk factors and internal control” chapter of this document.

The table below shows the results of this assessment in terms of residual materiality on a scale of three levels, from most material (lll) to least material (l).

SNFP* This risk also relates to the regulatory requirements set out in Articles L. 225-102-1 III and R. 225-105 of the French Commercial Code, which cover the Company’s Statement of Non-Financial Performance

“To rise to the immense challenges posed by the societal and environmental transformations currently underway, we are working and moving forward with all our stakeholders: our employees, who constitute our core strength and ability to take action; our clients, who are the reason why we seek to innovate and reinvent ourselves; our partners, with whom we develop technology solutions to help build a more sustainable world; our suppliers, who share our commitment; and our shareholders, whose support enables us to pursue our corporate plan.”

Cyril Malargé, Chief Executive Officer

1_ GHG: Greenhouse gases

2_ SBTi Net-Zero targets validated in 2023 – SBTi: Science Based Targets initiative

See Chapter 4 for more information

Our direct and indirect contribution to the 17 Sustainable Development Goals (SDGs) of the United Nations

Six major commitments aligned with the business model drive the Group’s strategy with respect to Corporate Responsibility:

1_ GHG: Greenhouse gas

The materiality analysis, which helps identify and prioritise the most relevant material and non-financial issues for the Company, was updated in 2023. With the entry into force of the Corporate Sustainability Reporting Directive (CSRD) with effect from 1 January 2024 (Order 2023-1142 of 6 December 2023 on the disclosure and certification of sustainability information), in-depth analysis is underway to define a new double materiality matrix encompassing both financial materiality and impact materiality. This entails a change of approach, with the new matrix determining both external (environmental and social) impacts on the Group’s performance and the business’s impact on its economic, social and natural environment.

1_ The full-year and half-year results are published in press releases and are presented at meetings, which are also made available as bilingual webcasts in French and English.

2_ Q1 and Q3 revenue is published in press releases and presented on bilingual (French and English) conference calls.

The Investor Relations Department engages in dialogue with the financial community throughout the year. It endeavours to meet with all shareholders, investors and financial analysts in the world’s main financial marketplaces during roadshows or conferences, as well as on the release of annual and interim financial reports and presentations, and at the General Meeting of Shareholders.

Investor Relations Department

Olivier Psaume

Phone: +33.1.40.67.68.16

Email: investors@soprasteria.com

ESG Investor Relations

Phone: +33.1.40.67.86.88

Email: investors@soprasteria.com

Individual Shareholder Relations

Phone: +33.1.40.67.68.26

Email: investors@soprasteria.com

Sopra Steria received an award from the Technical Committee of the 2023 Transparency Awards^*

Winner of a 2023 Transparency Award in the “Universal Registration Document” category

Sopra Steria ranks among the top 3 companies nominated for the Grand Prix for all categories, the Universal Registration Document and website

2nd place
in the Transparency Awards for regulated information

* Technical Committee of the Transparency Awards organised by Labrador

See Chapter 5 for more information

Revenue
in millions of euros

Net profit attributable to the Group
in millions of euros and % of revenue

Free cash flow
in millions of euros

Operating profit on business activity
in millions of euros and % of revenue

Dividend in euros
per share

(*) Amount proposed at the General Meeting of 21 May 2024

Sopra Steria share price
over 5 years* compared to performance
of SBF 120 and CAC 40

(*) Rebased 100 at 2 January 2019 (Source: Euronext Paris)

Until 2 September 2014, the name of the Company was “Sopra Group”. As a result of the successful public exchange offer made by Sopra Group for the shares of Groupe Steria SCA (see press release dated 6 August 2014), the Board of Directors met on 3 September 2014, with Pierre Pasquier presiding, and recorded the entry into effect of several resolutions conditionally adopted at the General Meeting of 27 June 2014.

Among the consequences of the implementation of these resolutions was the change in the corporate name from “Sopra Group” to “Sopra Steria Group”.

Registered office: PAE Les Glaisins, Annecy-le-Vieux, 74940 Annecy – France. Phone: +33(0)4 50 33 30 30.

Executive Management: 6 avenue Kléber, 75116 Paris – France. Phone: +33(0)1 40 67 29 29.

Legal form: French société anonyme.

Company website: https://www.soprasteria.com

Date of incorporation: 5 January 1968, with a term of fifty years as from 25 January 1968, renewed at the General Meeting of 19 June 2012 for a subsequent term of ninety-nine years.

Country where the entity is incorporated: France

Country where registered office is located: France

Name of the parent company: Sopra Steria Group

Name of the controlling company: Sopra Steria Group

Principal entity: Sopra Steria Group

Corporate purpose: “The Company’s purpose is:

To engage, in France and elsewhere, in consulting, expertise, research and training with regard to corporate organisation and information processing, in computer analysis and programming and in the performance of customised work.

The design and creation of automation and management systems, including the purchase and assembly of components and equipment, and appropriate software.

The creation or acquisition of and the operation of other businesses or establishments of a similar type.

And, generally, all commercial or financial transactions, movable or immovable, directly or indirectly related to said corporate purpose or in partnership or in association with other companies or persons” (Article 2 of the Articles of Association).

Commercial registration: 326 820 065 RCS Annecy

Place where legal documents may be consulted: Registered office.

ISIN: FR0000050809

Legal Entity Identifier (LEI): 96950020QIOHAAK9V551

Financial year: From 1 January to 31 December of each year.

Explanation of the changes to the name of the entity presenting the financial statements after the end of the previous reporting period: N/A

“An amount of at least five per cent shall be deducted from the profit for the financial year, reduced by prior losses, if any, in order to constitute the statutory reserve fund. Such deduction shall cease to be mandatory when the amount in the statutory reserve fund is equal to one-tenth of the share capital.

Profit available for distribution comprises the profit for the year less any losses carried forward and amounts allocated to reserves, pursuant to the law and the Articles of Association, plus retained earnings.

The General Meeting may deduct from this profit all amounts that it deems appropriate for allocation to all optional, ordinary or extraordinary reserves, or to retained earnings.

The balance, if any, is apportioned at the General Meeting between all shareholders in proportion to the number of shares that they own.

The General Meeting may also decide to distribute amounts deducted from the reserves at its disposal, expressly indicating the reserve items from which the deductions are made. However, dividends shall first be withdrawn from the profits for the financial year.” (Excerpt from Article 37 of the Articles of Association).

Backed by our strong entrepreneurial culture and our sense of collective purpose, we work every day to deliver a range of solutions to our clients’ information systems, from consulting to systems integration. We aim to be the benchmark partner for large public authorities, financial and industrial operators, and strategic companies in the main countries where we operate. We focus on being relevant at all times and ensuring that our impact is a positive one, both for society and from a business perspective.

The acquisition of CIMPA in October 2015 boosts Sopra Steria's presence in the product lifecycle management (PLM) market. Following the acquisition of software developer Cassiopae, finalised in January 2017, three new companies joined the Sopra Steria Group in 2017: Kentor, 2MoRO and Galitt.

In 2018, the Group acquires the German IT services company BLUECARAT to strengthen its position in Germany and offer new growth opportunities for its local subsidiary, as well as Apak to expand its range of lending solutions. In 2019, Sopra Steria takes two important steps forward in the core banking market: the acquisition of SAB, finalised on 7 August 2020. At the end of 2019, Sopra Steria also bolsters its operations and consolidates its strategy by launching its new digital transformation consulting brand, Sopra Steria Next. With the acquisition of Sodifrance in 2020, the Group created a market leader in digital services for insurers and social security providers. In the United Kingdom, Sopra Steria acquired cxpartners, bolstering its expertise in user experience and ergonomic design. Lastly, Fidor Solutions, the software subsidiary of next-generation bank Fidor Bank specialising in digital banking solutions, joined the Group on 31 December 2020. With this acquisition, Sopra Banking Software has significantly accelerated the pace of its development, in particular by augmenting user features as part of its SBP Digital Banking Suite.

In 2021, Sopra Steria was bolstered by the acquisition of French cybersecurity firm EVA Group. This acquisition was a key step toward positioning Sopra Steria as one of the top players in the French cybersecurity market.

The Group also acquired two other companies in 2021: EGGS Design, which specialises in digital service design and has locations in Norway’s four biggest cities (Oslo, Bergen, Trondheim and Stavanger) as well as in Denmark (Copenhagen), and Labs, a Norwegian user experience consulting firm.

In 2022, the Group acquired Footprint, a Norwegian consulting firm specialising in environmental and sustainability issues.

In 2023, Sopra Steria acquired Tobania in Belgium, CS Group in France and Ordina in the Netherlands. On 6 November 2023, Shared Services Connected Ltd (SSCL) became a wholly-owned subsidiary of Sopra Steria following the acquisition of the 25% stake in the SSCL joint venture held by the UK Cabinet Office.

Today, the Group ranks as a major player in Europe’s digital transformation market, having earned a reputation for providing end-to-end solutions to address the core business needs of large companies and organisations, helping them remain competitive and grow.

Complementing each other in business strengths, strategic verticals and geographies while sharing a similar corporate culture, Sopra and Steria merge to give birth to Sopra Steria Group.

In 2001, the Internet bubble bursts accelerating market changes. Clients are looking for global players capable of assisting them in transforming their businesses.

Steria rises to these challenges by completing major strategic acquisitions, including Bull’s IT services business in Europe in 2001, Mummert Consulting in Germany in 2005 and the business process outsourcing (BPO) expert Xansa in 2007.

Given the maturity of the IT services market, Sopra reexamines its fundamentals and refocuses on systems integration and software development. Sopra completes its initial public offering in 1990. Steria prioritises the rationalisation and industrialisation of processes to reorganise its functional structure. After landing a number of major deals, Steria proceeds with its initial public offering in 1999.

Sopra combines internal and external growth to consolidate its European expansion and its areas of expertise: consulting, systems integration and solutions development. Axway, a subsidiary formed by bringing together the Group’s software infrastructure divisions, is floated in 2011.

Sopra and Steria are two distinct entities, making their way forward in the emerging IT services industry. They both strive to meet the needs of major clients with innovative products and services. Sopra invests in software development and opens new locations in various markets. At the same time, Steria racks up several contract wins in the public sector.

In 2023, the digital services market in Western Europe was worth an estimated $362 billion (1), up 7.1% (2). For 2024, Gartner predicts growth of 8.3% (at constant US dollars).

Three countries (the United Kingdom, Germany and France) account for 58% of IT services spending (1).

According to market research, in 2023 the market (1) grew by 6.5% (2) in France, 6.6% in Germany and 6.8% in the United Kingdom. For 2024, growth is expected to continue, amounting to 7.5% in France, 7.5% in Germany and 8.2% in the United Kingdom.

Gartner expects this trend to continue over the next few years, with market growth in Western Europe estimated at around 8% to 10% per year between 2024 and 2027.

In terms of business segments, according to Gartner, consulting was up 7.6% (2) in 2023 and implementation services grew by 6.8%. The Group’s other activities also experienced a year of growth: Outsourced infrastructure and cloud services were up 6.9%, with business process outsourcing up 7.2%.

For 2024, Gartner predicts growth of 10.4% in consulting, 7.0% in implementation services and 8.1% in outsourced infrastructure and cloud services. Business process outsourcing is expected to grow by 8.4%.

Furthermore, the IT services market remains fragmented despite some consolidation, with the leading player in the European market holding a 6% share. Against this backdrop, Sopra Steria is one of the 13 largest digital services companies operating in Europe (excluding software) with an average market share of just under 2%. In France (third in the market) and Norway (fourth in the market), the Group’s market share is over 5%. In the other major European countries, its market share is around 1%.

Sopra Steria’s main competitors in Europe are: Accenture, Atos, Capgemini, CGI, DXC and IBM, all of which are present worldwide. It also faces competition from Indian groups, chiefly in the United Kingdom (such as TCS, Cognizant, Wipro and Infosys), and local companies with a strong regional presence (Indra in Spain, Fujitsu in the United Kingdom, Tietoevry in Scandinavia, etc.).

Sopra Steria, a major actor in Europe’s consulting, digital services and solutions market, helps its clients drive their digital transformation and obtain tangible and sustainable benefits, thanks to one of the most comprehensive portfolios of offerings on the market, encompassing consulting and systems integration, industry- and technology-specific solutions, hybrid cloud and technology services, cybersecurity and business process services.

The Group provides end-to-end solutions to make large companies and organisations more competitive by combining in-depth knowledge of a wide range of business sectors and innovative technologies with a fully collaborative approach: from strategic analysis, programme definition and implementation, and IT infrastructure transformation and operation, to designing and implementing solutions and outsourcing business processes.

For Sopra Steria, helping clients succeed in their digital transformation means breaking down their strategic and business challenges into digital initiatives through an exclusive end-to-end offering. Thanks to very close relationships with its clients and its multi-disciplinary teams, the Group is able to continually innovate to guarantee that its offerings remain relevant to the strategic challenges of each of its vertical markets.

Sopra Steria’s teams are trained in new microservices platforms, DevOps and cloud computing. They are also adopting new methods of designing, delivering and embedding teams. Sopra Steria is therefore able to offer the two key ingredients for successful digital transformation: speed of execution and openness to external ecosystems.

Sopra Steria Group is also the preferred partner of Axway Software, whose exchange and digital enablement platforms play an important role in modernising information systems and opening them up to digital technology.

Sopra Steria is an independent Group whose founders and managers control 22.2% of its share capital and 33.7% of its theoretical voting rights. With 56,000 employees in nearly 30 countries, it pursues a strategy based on European key accounts.

Sopra Steria Next, the Group’s consulting brand, is a leading consulting firm. Sopra Steria Next has over 40 years’ experience in business and technological consultancy for large companies and public bodies, with nearly 4,000 consultants in France and Europe. Its aim is to accelerate the development and competitiveness of its clients by supporting them in their digital transformation while addressing their sustainability challenges in keeping with our clients’ Corporate Responsibility policies. This support involves understanding clients’ business issues using substantial sector-specific expertise, and then working to design transformation roadmaps (business processes, data architecture, change management, etc.) to make the most of new digital technologies such as data and AI. It involves supporting the IT departments of our clients, grasping their new challenges and assisting them with their overall transformation projects as well as the modernisation of their legacy systems.

Systems integration is Sopra Steria’s original core business and covers all aspects of the information system lifecycle and major transformation programmes. Sopra Steria is equipped to address the full range of its clients’ software asset needs:

Sopra Steria’s teams help their clients implement agile and industrial-scale projects. The Group undertakes to design and deliver systems in line with business requirements that are flexible and adapted to the new requirements of digital transformation as well as sector-specific regulatory constraints. This is made possible by working closely with the Sopra Steria Next teams.

In addition to standard information systems maintenance, Sopra Steria takes a continuous transformation approach to these systems to guarantee optimised operational efficiency for its clients, suited to changes in their business. The transformation approach includes a well-equipped and documented procedure making it possible to combine the issues involved in reducing the time to market with improved competitiveness and continuity of service.

Once the systems and technologies are implemented, the information system gives access to reliable, relevant and critical data and services, offering better analysis of user satisfaction and optimisation of business performance.

With the increasing number of diverse data sources relating to fundamental changes in use, data is more valuable to the company than ever. To increase the value of this data, Sopra Steria has developed specific know-how and expertise to manage the exponential growth in data volumes and associated skills (AI, data science, smart machines, automation, artificial intelligence) by integrating them into a global solution, securing the data regardless of its origin (mobile devices, smart objects, data privacy, the cloud, multimodal and multichannel systems, etc.) and using the data by means of contextualised algorithms, taking into account associated ethics.

The Group’s systems integration offering thus meets the challenges posed by both the obsolescence and modernisation of information systems, ensuring optimal flexibility and value creation.

CIMPA provides comprehensive expertise via its PLM offering, which covers all the various facets of PLM services:

• ■PLM strategy creation or optimisation;
• ■deployment of strategy-related tools, processes or methods;
• ■user training and support.

With over 30 years’ experience and a team of over 6,500 experts around the world, Sopra Steria is a partner of choice for a controlled, secure and responsible information system transformation. A leader in the hybridisation of information systems and a major player in digital transformation, we offer solutions tailored to our clients and backed by our Service Centres in Europe and India. Our expertise, which spans Hybrid Cloud management to the transformation of infrastructures and operational models, encompasses end-to-end consulting, transformation projects and outsourcing. We are committed to simplifying operations and strengthening the performance and resilience of information systems, while also enhancing business agility and transparency.

Our area of expertise covers two business lines that are essential to support information system transformation for our clients:

• ■our Dynamic Operations Platform facilitates alignment with client business lines, bringing together flexibility and the best in technology, agile business models and organisational structures to achieve optimum resilience, performance and innovation in IT systems;
• ■our Dynamic Support Experience offers fully user-centric support focused on the user’s business context. Our personalised approach helps them develop autonomy in managing their day-to-day challenges and increase their productivity.

Sopra Steria’s expertise in legacy applications, its close working relationship with its clients and its DNA as a sovereign and responsible company are all valuable elements that enable it to address the challenges faced by organisations.

With over 2,200 experts and several state-of-the-art cybersecurity centres in Europe and worldwide, Sopra Steria has an international reach as a European leader in protecting critical systems and sensitive information assets for major institutional and private clients.

We have developed a portfolio of services that enable our clients to address their strategic challenges as they face the threat of increasingly frequent and sophisticated attacks.

This range of services covers the entire cybersecurity value chain, from risk prevention and the safeguarding of sensitive information to detection and response:

• ■prevention: drawing up a cybersecurity strategy that is adapted to the risks of the business and complies with the regulations in force, and spreading a culture of security within the organisation;
• ■protection: ensuring the continuous monitoring of assets by securing multi-cloud and hybrid environments, end-to-end encryption of applications and sensitive data;
• ■detection and response: adopting an overall defence strategy that mobilises all stakeholders to work together (detection, response, cyber threat intelligence, investigation, vulnerability management, etc.) towards a shared goal – recognising attackers and countering cyberattacks.

With the acquisition of CS Group in 2023, Sopra Steria further enhanced its portfolio of sovereign solutions, including hardened operating systems, digital trust services and event correlation tools.

Lastly, we have developed specific offerings designed to address our clients’ current priority concerns: Crisis management and cyber resilience, cloud security and industrial security.

Sopra Steria’s business model based around value centres and products is designed to maximise the cyber value of the services delivered by the Group. It can be rolled out locally, through service centres (in France, nearshore in Poland and offshore in India) or in hybrid form, with a “follow-the-sun” capability to help our clients at all times.

Sopra Steria offers its business expertise to clients via packaged solutions in three areas: banks and other financial institutions via Sopra Banking Software, human resources via Sopra HR Software, and real estate owners and agents with its property management solutions. The Group offers its clients the most powerful solutions, in line with their objectives and representing the state of the art in terms of technology, know-how and expertise in each of these three areas.

Drawing on its technologies and the strength of its commitment, Sopra Banking Software, a wholly-owned subsidiary of the Group, supports its clients – financial institutions – all over the world on a daily basis.

Customer experience, operational excellence, cost control, compliance and risk reduction are among the key transformation priorities for:

• ■banks in Europe and Africa: from direct- and branch-based retail banks and private banks to microfinance companies, Islamic financial institutions and centralised payment or credit factories;
• ■financing and lending institutions around the world: serving individuals and companies, the automotive and capital goods sectors, as well as equipment and real estate leasing and even market financing.

With over 4,000 experts worldwide, Sopra Banking Software addresses its clients’ challenges across all geographies and in all business areas, covering issues such as communicating new offerings, the quality of customer relationships, production, accounting integration and regulatory reporting.

Sopra Banking Software offers two services: Sopra Banking Platform, intended to respond to banks’ day-to-day needs, and Sopra Financing Platform, which specialises in managing financing:

• ■Sopra Banking Platform is a banking processing platform that relies on an architecture of independent and pre-integrated business components. It makes it possible to manage all banking operations (deposits and savings, management of the loan lifecycle, payments, reporting) and offers innovative features in a digital and mobile environment.
• ■Sopra Financing Platform is a flexible, robust financing management platform able to deal with all types of financing tools within the framework of advanced process automation.

These solutions can be used either on-site at the client’s premises, on the cloud (public or private) or in SaaS mode.

An end-to-end provider, Sopra Banking Software offers solutions as well as consulting, implementation, maintenance and training services. This means that financial institutions are able to maintain their day-to-day operations while shifting towards greater innovation and agility, with the aim of securing sustainable growth. Through its market-leading solutions backed by more than 50 years of experience in its field, Sopra Banking Software is committed to working with its clients and staff to build the financial world of the future.

Sopra Steria Group also develops human resource management solutions via Sopra HR Software (a wholly-owned subsidiary of Sopra Steria). Sopra HR Software is present in 10 countries, providing comprehensive HR solutions perfectly suited to the needs of human resources departments. Sopra HR Software currently has a workforce of 2,000 people and manages the payrolls of 900 clients with over 12 million employees.

Sopra HR Software is a partner for successful digital transformation of companies and anticipates new generations of HR solutions.

The solutions offered by Sopra HR Software are based on the most innovative business practices and cover a wide range of functions, including core HR, payroll, time and activity tracking, talent management, employee experience and HR analytics. The offering is based on two product lines, HR Access® and Pléiades®, aimed at large and medium-sized public or private organisations in any sector and of varying organisational complexity, irrespective of their location. In response to new hybrid working patterns, the new generation of Sopra HR 4YOU solutions offers a fully digital HR space that helps businesses stay closely connected with their employees and optimise HR performance and the quality of HR services.

Within Sopra HR Lab, Sopra HR anticipates the emergence of innovative HR solutions.

Sopra HR Software, a comprehensive service provider, offers a number of services linked to its solution offering and its HR ecosystem. Sopra HR Software supports its clients throughout their projects, from consulting through to implementation, including staff training, maintenance and business process services (BPS).

Sopra HR Software implements its own solutions either on-premise or in the cloud and also offers a wide range of managed services.

Sopra Real Estate Software is the leading developer, distributor, integrator, and service manager of property management software in France. Sopra Steria offers major public and private sector real estate players (institutional investors, social housing operators, property management firms, property managers and major users) comprehensive business software solutions providing a huge range of functionality.

Sopra Real Estate Software’s 650 real estate experts help our 400 clients realise their digital transformation so as to boost their return on assets, optimise practices and strengthen relationships with tenants and service providers.

Sopra Real Estate Software also offers a technical real estate asset management solution that is particularly well suited to helping our clients better understand their assets and manage their energy performance.

From property management to building information management, we offer a range of solutions built around providing digital real estate services to tenants and partners.

Sopra Real Estate Software supports its clients with an end-to-end service offering based on its solutions, from consulting to integration and managed services.

Sopra Steria offers a full range of business process services (BPS) solutions: consulting for the identification of target operating models, development of transition and transformation plans, and managed services. The Group delivers innovation with purpose, combining its longstanding experience in BPS and end-to-end digital expertise – including next-generation technologies such as artificial intelligence (AI), robotics, and natural language processing (NLP).

Sopra Steria manages two of Europe’s largest shared services organisations: Shared Services Connected Limited (SSCL) and NHS Shared Business Services (NHS SBS). SSCL was formed originally as a joint venture between Sopra Steria and the UK Cabinet Office in 2013, and became a wholly owned subsidiary of Sopra Steria in Q4 2023. NHS Shared Business Services is a joint venture between Sopra Steria and the Department for Health and Social Care that provides support services to NHS trusts and UK health bodies. Together with these shared-service powerhouses, Sopra Steria provides a full range of business support services to major government departments, the police and UK government agencies.

The Group’s BPS offering goes hand in hand with digital transformation and a host of high-potential next-generation technologies. Sopra Steria is at the forefront of utilising AI technology to revolutionise how its customers’ business operations and user experiences are delivered. In 2023 we were successful at NS&I Bank in winning two major contracts to deploy AI to transform and manage all aspects of business and citizen contact to meet the demands of an increasingly demanding customer base. At the UK’s Home Office Border Force, the Group’s subsidiary SSCL won a recruitment management contract that will see it using AI to transform the candidate experience and recruitment outcomes. Whether through AI, robotics, chatbots or natural language processing, the Group streamlines the execution of processes, empowering workforces and driving new approaches for its clients every day through the application of cutting-edge digital solutions.

Sopra Steria is a trusted integrator, bringing together its own platforms with offerings from a dynamic network of global BPS partners, and, through its open innovation expertise, the niche, highly coveted capabilities of startups and SMEs to deliver best-in-class solutions to its customers.

To deliver sustainable transformation, the Group puts people before processes and tools. Sopra Steria’s change management experts work alongside clients to help engage their workforce as co-beneficiaries of transformation. The Group’s ability to approach change from a human and business perspective allows it to support our clients wherever their digital journey takes them, driving purposeful, future-proof business outcomes.

Sopra Steria has chosen eight major vertical markets that constitute its areas of excellence and make up 91% of revenue. The Group has a comprehensive offering in each of these fields, meeting the specific challenges of its clients.

The banking and financial services sector has entered a new era, that of Open Banking. Client demands and regulatory pressures are constantly increasing and new market entrants (fintech companies, the “Big Four” tech companies, retail and telecoms players, etc.) are helping to accelerate transformations in this ecosystem, moving it toward greater openness, a paradigm shift often referred to as the Open Banking revolution.

In view of these new challenges, Sopra Steria aims to be a partner for banks, helping to facilitate and accelerate this transformation.

With three core areas of expertise – understanding of the banking sector, its clients and the most innovative technologies, from AI to cybersecurity – the Group offers powerful and agile software solutions, as well as their application by means of value-added use. The Group and its subsidiary Sopra Banking Software provide comprehensive solutions and turn changes in the banking world into opportunities for their clients, whether in risk management, data protection, improving customer experience, optimising performance, delivering differentiation or identifying new sources of income, while ensuring compliance and a high level of security.

Faced with new expectations from civil society and businesses, the need to optimise their expenditure, the obligation to keep up with regulatory changes and driven by a wave of reforms, public sector entities are continuing the broad-based transformation of their activities, organisations and the services offered to their users.

When digital technology is a force for change, Sopra Steria provides solutions in two main categories: (i) the digitalisation of government services, the re-engineering of processes and, more generally, the modernisation of business-specific information systems via digital transformation programmes, and (ii) the pooling of support functions for central government agencies, local authorities, and key providers in the health and welfare sectors.

As a result, public sector organisations can ensure that they meet their targets and priorities at the lowest cost, while giving their information system the agility it requires to meet the high expectations from civil society and agents.

The aeronautics sector is a particularly fertile ground for innovation. It is subject to constraints regarding reliability, availability, security and performance, which require suppliers to have full command of the technologies and processes implemented, as well as a thorough understanding of their different clients’ core businesses.

For optimal service, companies operating in this sector must align their capacities with the pace of production and optimise their processes and information systems while also improving profitability. Digital continuity and the ability to manage the product lifecycle, from design to manufacture and after-sales services, are crucial. Sopra Steria’s acquisition in 2015 of CIMPA, a specialist in product lifecycle management, makes total sense in this context particularly as it was followed in 2017 by the acquisition of 2MoRO, extending the Group’s offering in aerospace maintenance activities.

To meet these challenges, Sopra Steria’s expertise comes into play through the Aeroline vertical in such critical areas as industrial efficiency, manufacturing and particularly the shop floor, supply chain, on-board systems and air traffic control.

Following the 2023 acquisition of CS Group, with its 40 years’ experience in the space industry, Sopra Steria is now a major player in the European digital space technology arena. Its technology solutions and business lines address the entire added value chain:

• ■from space engineering services through to integration of onboard and ground-based turnkey systems that meet resilience and safety requirements;
• ■from space mission analysis through to operation and use;
• ■from spacecraft command and control through to processing the large amounts of data generated;
• ■from advanced forecasting algorithms through to decision support systems.

This positioning enables the Group to be involved in space programmes that are high on the global agenda in terms of sustainability and security and to address a market which, having historically been supported by government funding, is now changing fast. Rapid technological progress is unlocking new capacity, encouraging commercial funding of space projects and making space more accessible to nations and the private sector.

This democratisation of access to space is fostering a dynamic and innovative ecosystem with an evolving business model (on-demand access) while guaranteeing safety both in space and on the ground.

In response to these challenges, Sopra Steria has introduced the Smart Space concept, helping foster a continuum between feedback from legacy players and the capacity to innovate so as to create new and secure high-performance products and services that deliver on the priorities of space programmes.

In a tense geopolitical context, marked by the rise of new threats to states (high-intensity major conflicts, cybercrime, terrorism, etc.), defence departments face numerous challenges and must improve their effectiveness while taking into account budgetary constraints. It has become essential to ensure information superiority, data interoperability and critical operational systems security.

With over 40 years’ experience in supporting the military in Europe, Sopra Steria combines pragmatism and innovation, thanks to tailored technological and process solutions:

• 1 .reliability and interoperability of operational information and communication systems;
• 2 .efficiency and overall effectiveness of the armed forces;
• 3 .efficiency of the military supply chain (supply chain management);
• 4 .control over costs and the complexity of ensuring compliance for information systems.

As a company specialising in digital services, Sopra Steria does not engage in the manufacture, maintenance or marketing of controversial defence equipment.

Sopra Steria supports public authorities in meeting the challenges of homeland security. The Group operates in 24 countries, serving many different organisations: police, emergency services, border control, justice, customs and homeland security services.

Sopra Steria carries out large-scale, complex and critical projects on behalf of these organisations, concerning:

• ■survey management and information processing;
• ■road safety;
• ■automation of command-and-control solutions;
• ■management of identity documents, security credentials, and civil and criminal biometrics;
• ■modernisation of court- and prison-related administration;
• ■intelligent, distributed computer systems;
• ■infrastructure security;
• ■mobile technologies to optimise operations on the ground.

In addition, the Group has developed innovative solutions specific to the security sector, to meet the challenges and requirements of clients in this field (biometrics, mobile technology, fingerprint and genetic footprint search engines, implementing secure cloud solutions etc.).

The energy sector in Europe and in France is in the midst of its most radical transformation since the end of the Second World War. Public institutions, civil society and the private sector have taken into account Europe’s decision to achieve carbon neutrality by 2050, with the recent energy crisis in Europe sparking an increase in investment decisions.

Becoming carbon-neutral will require a thorough overhaul of the energy sector’s value chain, from production to marketing, with electricity replacing fossil fuels, and biogas and hydrogen acting as complementary forces, particularly for industry.

For energy providers, this raises a number of specific challenges:

• ■in production: striving for excellence in the field of low-carbon (especially nuclear) and renewable energy production, while mastering the technological, financial and societal challenges associated with accepting the many projects to be launched in the various regions;
• ■in transmission and distribution: spearheading a wave of investment in response to the need to scale up renewable energy production, connect production facilities to the grid, and operate those facilities under optimum conditions by modernising and digitalising management of the grid;
• ■in marketing: optimising the customer experience and creating offers that combine energy and services to retain and win over new customers, and to respond to new usage patterns (electric mobility, self-consumption, etc.).

Against this backdrop, Sopra Steria supports energy suppliers and utilities in their strategic responses to trends affecting a number of areas:

• ■experience and client acquisition: reinventing customer relations and designing new services;
• ■digital continuity of engineering: helping our major clients achieve their ambitions in developing new carbon-free, nuclear and renewable energy production sites;
• ■power grid modernisation: ramping up the decentralisation and digitalisation of energy transmission and distribution grids;
• ■modernisation and optimisation of information systems to enable energy transition investments;
• ■transformation and resilience of organisations: facilitating changes in organisations and business lines to promote agility.

The telecoms, media and entertainment sector is at the centre of the digital revolution, for three reasons:

• ■it supports the digitalisation of all the other verticals, in particular by feeding the data collected from billions of objects to algorithms;
• ■it also serves as the testing ground for the implementation of new technologies and uses as part of a platform-based business model;
• ■lastly, it plays a key role in ensuring economies are resilient, as demonstrated during the Covid-19 pandemic.

Sopra Steria serves the transformation goals of its clients in relation to the following main challenges:

• ■deployment of new infrastructures: fibre and 5G to help meet countries’ industrial requirements by providing them with very high-speed fixed and mobile connectivity;
• ■infrastructure management: moving from a configurable to a programmable approach for essential infrastructure, such as the cloud, SDN/NFV and most recently 5G;
• ■automation: so that the company is able to interact in real time, in particular thanks to AI, with all members of its ecosystem (customers, suppliers, partners, employees, infrastructures);
• ■greater business agility: making it easier to readapt, readjust and realign the company and its organisational structures to better seize new opportunities and also to further improve the engagement of managers and their teams in service of clients;
• ■digitalisation of services: laying down the fundamentals of the platform-based business, thus moving to fully digital and end-to-end solutions, from client to infrastructure;
• ■core media business: taking up new models, such as SVOD, AVOD, content aggregation, targeted advertising and 4K;
• ■core gaming business: customer retention and churn, fraud reduction and control over cash flows, compliance with regulations, digitalisation of distribution channels.

Given that the transport sector accounts for 30% (3) of GHG (greenhouse gas) emissions, all players in the sector will have to undergo major changes in the short- to medium-term to reduce their footprint. Meanwhile, mobility and logistical needs are constantly changing and must contend with new challenges: increased international traffic and interoperability, the development of platforms to facilitate access to mobility services in urban areas, the upgrading of infrastructure both in terms of capacity and modernity, and new approaches to urban logistics as the volume of goods driven by e-commerce explodes and last-mile services in densely populated areas require new approaches.

Faced with these major challenges, the transport industry needs to implement strategies, investments and services to encourage travellers to choose the most environmentally friendly solutions by facilitating access to services, using “door-to-door” methods, offering seamless Intermodality, integrating micro-mobility, and developing new payment and customer experience models. Transporters, infrastructure managers and logisticians progressively update their operating and supervision models to integrate the new functionalities made possible by data and predictive models. Advances in autonomous driving and vehicles are a key issue in urban areas.

The energy crisis is also set to accelerate changes that were already underway in relation to optimising processes, reducing energy consumption at industrial properties, continuing to develop clean transportation and developing green hydrogen solutions.

Sopra Steria Group is a leading partner of choice to major players in the transport industry to help them achieve their digital transformation goals in three key areas of their value chain: transformation of the urban and multimodal experience; platformisation of operating and command-and-control systems, operational supervision and traffic management; and excellence of industrial operations and asset management.

The Group also aims to be a recognised player in mobility ecosystems: MaaS platforms, autonomous shuttles/vehicles, and smart cities.

Its expertise in the digital domain is recognised in the transport industry, particularly in relation to business consulting, digital expertise (Big Data, AI, IoT, etc.), cloud migration from consulting through to migration factory, integration of specialist solutions, and cybersecurity.

Sopra Steria is one of Europe’s top 10 digital services companies in business and information system transformation for major clients in the rail sector, transport authorities, urban operators, motorway concessions groups, postal services, aviation and logistics.

The insurance sector is fiercely competitive due to the increasing standardisation of offers, high interest rates and the escalating regulatory burden. At the same time, clients are exhibiting new behaviours, with a shift in expectation toward the hyper-personalisation of products and services.

In this increasingly competitive global context, leading insurers continue to look to consolidation and transformation as the way forward in order to be comprehensive insurers and open their distribution models. To set themselves apart, they are developing extended services and are taking into account the new risks associated with use (as opposed to ownership) of property, the rise of service business models, the sharing economy and cybersecurity.

Sopra Steria offers its clients a comprehensive solution for the implementation of new business models, support for strategic plans and digital transformation, helping in particular to open the business and its information system to new partnerships and services across an extended value chain.

Retailers face a challenging business environment as well as profound and continual changes in the shopping habits of customers, who increasingly use digital technology. To remain competitive, transformation is essential. The aim is to secure and better manage retail business practices by offering a real ability to innovate to meet consumer demand for immediate and flexible services while respecting environmental issues.

Sopra Steria assists retailers with their digital transformation and has developed knowledge and experience in multi-channel commerce, optimisation of logistics chains and understanding customer experiences.

The Group has continued its R&D efforts, investing €122 million (4) in 2023 (versus €114 million in 2022) in developing and expanding its business solutions. These are gross amounts and do not take into account funding related to the French R&D tax credit (CIR).

Sopra Steria’s ambition is to be a European leader in digital transformation. Its high value-added solutions, delivered by applying an end-to-end approach to transformation, enable its clients to make the best use of digital technology to innovate, transform their models (business as well as operating models), and optimise their performance.

The Group’s aim is to be the benchmark partner for large public authorities, financial and industrial operators and strategic companies in the main countries in which it operates.

To achieve this aim, Sopra Steria continues to strengthen its key competitive advantages:

• ■leading positions in priority verticals (Financial Services, Aerospace, Defence & Security, Public Sector);
• ■very close relationships with its clients, thanks to its roots in the regions where it operates and its ability to meet core business requirements;
• ■a strong European footprint with numerous locations in many of the region’s countries which, when combined with these close relationships, raises its profile among large public authorities and strategic companies throughout Europe as a trusted and preferred partner for all projects involving digital sovereignty;
• ■business software solutions which, when combined with the Group’s full range of services, make its offering unique.

Lastly, the Group’s mission statement – formally adopted in 2019 – reflects both its values and its desire to help meet the Sustainable Development Goals of the Company and its stakeholders: “Together, building a positive future by making digital work for people.”

In order to position itself even more securely with client decision-makers at the business department level, the Group is continuing its move up the value chain in consulting, and confirms its medium-term target of continuing to develop its activities in this area. To do this, it is gradually developing a range of consulting services and capacity in all of the regions in which it operates, using a model that favours synergies with the Group’s other business lines. The Group’s plan is to establish and develop a European consulting capability specialising in business transformation through technology. The Group aims to help its clients define and deliver on the promises they make to their own clients and employees by seizing opportunities offered by the ongoing digital, environmental and social transitions, in support of the Group’s strategy. The Group’s ambition is to be a powerful and widely recognised European consulting firm at the cutting edge of innovation in technology and management, where business and technology intersect, offering tailored solutions designed to address specific business issues while honouring its clients’ culture and ESG policy (5). The consulting business mainly operates in three segments: IT consulting; operational consulting, with a focus on Group clients’ core business; and strategy consulting, with a focus on digital services and associated marketing, innovation and data use.

The prominence of the Sopra Steria Next brand, created in 2019 to promote the Group’s digital transformation consulting expertise, has benefited from this. In France, it is also bolstered by the Group’s decision to integrate its CSR mission into its consulting activities. This mission, built around the idea of digital ethics, is backed by a dedicated communications plan.

Sopra Steria has successfully completed numerous digital projects. Its experience has allowed it to offer a holistic approach to digital transformation to the market, based on a series of best practices.

To step up its commitment to digital technology, the Group is continuing to invest with the goal of:

• ■being at the cutting edge of the market in all of its services and business models;
• ■strengthening its technology assets;
• ■transforming its operating models;
• ■educating all of its employees in digital culture, practices and skills;
• ■keeping an eye on the market in order to clarify its digital strategy and target the best digital partners.

The Group is adapting its software to factor in advances in digital technology in a number of key areas, such as the customer/user experience, analytics, AI, APIs, etc., and to take account in their architecture of changes in client needs, such as growing use of the (hybrid) cloud, increasing demand for Software-as-a-Service and the gradual adoption of the platform company model (particularly in the financial sector).

The same approach is being applied for each of the Group’s service activities – Consulting, Application Services (Build and Application Management), Infrastructure Management, Cybersecurity, Business Process Services – with the following Group objectives:

• ■using the potential of new technologies – analytics, smart machines, blockchain, IoT, augmented/virtual reality etc. – to benefit its clients through innovative applications, with a particular focus on AI, and in particular generative AI, through a large-scale programme launched in 2023 across all the Group’s geographies and involving all its business lines;
• ■driving its clients’ transformation from its current position: for example, the Application Management offering has evolved to encompass the end-to-end transformation of processes and the corresponding modernisation of existing IT systems, including connecting digital technologies with legacy systems and migrating all or some of the IT system to the cloud;
• ■promoting new end-to-end approaches combining consulting and software: providing IT strategy support for large companies and public authorities, implementing digital continuity in industrial value chains, building service platforms, overseeing the cloud-based and digital transformation of information systems, etc.

The digitalisation of solutions and services and, more broadly speaking, changing client expectations, have led the Group to adapt its business models. The Group will thus be selling more and more solutions operated on behalf of clients and, in services, increasingly leveraging intellectual property (reusable components, implementation accelerators, etc.). It will thus generate more recurring revenue through its solutions, with less of a direct connection to the size of its workforce in services.

The Group is continually investing in the exploration of new ideas and expertise in architectures, and in emerging digital, cloud and AI technologies and uses, relying on its teams of “digital champions” (experts led by the Group’s Chief Technology Officer).

At the same time, all necessary resources are being designed and put in place to rapidly develop and operate digital solutions on behalf of the Group’s clients that are natively designed to function in hybrid cloud environments:

• ■the Digital Enablement Platform (DEP), the technical foundation for building or modernising IT systems (designed to be able to interact with components of Amplify, Axway’s hybrid integration platform), an industrial DevOps chain and an environment to capitalise on and search for reusable software components, a private cloud that can be extended to the main public clouds;
• ■implementation accelerators for new digital technologies (smart machines, AI/machine learning, blockchain, IoT, etc.);
• ■digital factories to enable service offerings combining consulting and software (e.g. migrating information systems to the cloud).

In early 2023, the Group launched a massive initiative supporting the adoption of advances brought about by generative AI. The rAIse® programme aims to use AI to transform the Group’s practices by creating an end-to-end client offering and systematically building AI into its technology assets over the long term.

The Group is gradually changing the operating model for its services and R&D activities (by integrating its aforementioned technology assets):

• ■extensive experience with agile projects (including many in collaboration with offshore and nearshore centres);
• ■roll-out of processes and resources (software and digital factories) for industrialisation, automation, AI use and reusable components developed to boost productivity and quality for IT services and R&D activities.

In particular, this involves greater use of smart machines (robotic process automation, intelligent automation, virtual assistants, generative AI) in the Group’s recurring service activities (in connection with its Business Process Services, Infrastructure Management, Application Management and Support offerings) as well as expanding the reuse of existing technology- or industry-specific software components (IP blocks, open source) and the use of low-code/no-code development platforms for building solutions:

• ■transformation in line with the production model of each activity (distribution of roles between the onshore production teams, the service centres, and the offshore and nearshore R&D teams).

To accompany its transformation, the Group is making a considerable effort to train its employees and managers:

• ■strengthening its training offering: introductory and more advanced courses on all digital/cloud technologies, training on new digital practices and new industrial environments, training on the digital services and solutions offered by the Group;
• ■digitalisation of training resources: virtual training rooms, in-house e-learning and access to MOOC-style learning platforms.

Numerous initiatives are being encouraged to promote and enhance innovation, such as the Group’s digital champions keeping an eye on technology advances and uses, innovation imperatives assigned to project teams, internal innovation competitions to develop new digital uses, hackathons open to clients and partners, as well as platforms for digital demonstrations, brainstorming, co-design, rapid development and technology intelligence open to clients, employees and partners (DigiLabs at all the Group’s major locations and a Next centre at its registered office), etc.

The rAIse® programme encourages the Group as a whole to experiment with the advances brought about by AI, and in particular generative AI. All entities are working towards being able to offer their clients AI-powered solutions, incorporating AI into their everyday practices and training all employees.

Special efforts are being made to establish targeted partnerships with leading players in the digital ecosystem by vertical and by major technology area (startups and niche players, institutions of higher education and research laboratories, top software development companies, tech giants, etc.). It is within this framework that a strategic partnership has been forged with Axway.

In order to ensure effective market intelligence, a collaborative startup observatory is made available to the Group’s teams of digital champions and all its managers.

In certain very specific cases relating to its digital strategy, the Group may directly or indirectly take equity stakes (through specialised funds) in young startups that it considers the most innovative in the market, applying a corporate venturing approach.

To support its positioning goals, the Group is continuing its policy targeting specific vertical markets, key accounts and business areas in all countries where it operates.

There are eight priority verticals that currently account for the majority of revenue: Financial Services; Public Sector; Aeronautics, Space, Defence & Security; Energy & Utilities; Telecoms, Media & Entertainment; Transport; Insurance; Retail.

For each vertical, the Group selects a small number of key accounts (fewer than 100 at Group level), focuses on a few different business areas in which it aims to secure a leading position and implements an inter-entity coordination system for the different countries and subsidiaries concerned.

Some of these verticals are considered particularly strategic. The Group has very clear strengths in several countries (broad position, IT and business expertise, replicable experiences etc.). The transformation needs of businesses, public authorities and ecosystems in place are considerable and rely on similar solutions from one country to the next. These verticals (Financial Services, Aerospace, Defence & Security, Public Sector) are eligible for corporate investment or external growth transactions.

In order to achieve its leadership objective in its targeted verticals and business areas, the Group mobilises the development efforts of its various entities to build end-to-end value propositions as well as offerings of business solutions designed to address the business challenges faced by its major clients. As an example, the Group applies this approach to meet digital continuity challenges in the aerospace value chain.

The Group confirmed its target to continue growing its development activities in human resource management and property management (Sopra HR Software and Sopra Real Estate Software) as well as its activities in solution integration. Efforts will continue to be focused on enriching the Group’s solutions, adapting them to cloud systems, leveraging API-based access to data and services, integrating new digital technologies, developing managed services, and expanding operations into new geographic markets.

Management at the Group’s software entities confirmed the benefits of mapping out a Software Project that goes beyond merely setting up a reporting and control hub.

The Group makes regular targeted acquisitions in order to enhance its offering and expertise or strengthen its position in certain regions. In this context, it will be able to carry out larger acquisitions.

Sopra Steria has long been committed to corporate responsibility. The Group’s progress in the area of sustainability is underpinned by a holistic approach that takes into account the impact of its activities on the environment and society and includes the following:

• ■an employee policy that positions the Group as a leading employer by focusing on diversity, equity and inclusion;
• ■a rigorous environmental trajectory to mitigate the impact of our activities on the environment and help combat climate change;
• ■an ethical approach in our day-to-day operations and across all our business activities;
• ■support for local communities through community initiatives focused on education and digital inclusion.

The Group’s workforce-related, environmental, ethical and inclusive commitments are applied across its entire value chain, with suppliers being held accountable. Digital technology is harnessed to enable the Group to offer more responsible services and solutions that deliver lasting value.

The Group’s commitments are guided by three key priorities, which are broken down into qualitative and quantitative targets and regularly reviewed to ensure they take into account advances in scientific knowledge, changes in the external environment and societal challenges:

• ■helping combat climate change by enacting two complementary strategies:
  • ●mitigating the environmental footprint (both that of the Group, through our Net-Zero strategy, and that of our clients through assessing and optimising the environmental impact of digital solutions offered, built or operated by the Group on their behalf), and
  • ●adapting to the challenges posed by the ecological transition (by developing innovative solutions, tools, services and projects in support of the environment and the climate);
• ■proactively putting more women into management roles and fostering an environment conducive to workplace gender equality and equal opportunity;
• ■embedding responsible, sustainable digital technology issues into the Group’s different business lines and our value proposition with regard to stakeholders, in particular clients and suppliers.

Sopra Steria plans to expand its development of digital services and solutions in Europe and focus its investments on consulting and digital technology in its strategic verticals: financial services, defence & security, aeronautics, space and the public sector. The Group’s ambition is to become a compelling European alternative to global providers, particularly with regard to issues of digital sovereignty, for major European clients in its strategic verticals.

Its corporate plan is set within an upbeat market for digital services in the medium term, boosted by demand for digital transformation on the part of businesses and institutions looking to optimise their processes and increase their resilience.

Cyril Malargé, Chief Executive Officer of Sopra Steria Group, commented:

“Thanks to the commitment of our 56,000 employees, who work hard every day to advance their clients’ digital transformation, Sopra Steria performed very well in financial year 2023. I’d like to commend all our teams on the results they achieved.

We comfortably achieved the financial targets we had set for ourselves.

We made significant headway with a range of transformative initiatives: developing our Consulting business, shifting our technology solutions further up the value chain, gradually adjusting our operating model, reinforcing our human resources policy and boosting our operational efficiency. We plan to keep scaling up our efforts in these areas over the coming quarters.

In the first half of 2023, we launched rAIse®: a large-scale programme to embrace generative AI, which will feed into everything our business consulting teams do, our internal development tools and our partnership strategy.

With the acquisition of CS Group, we have considerably strengthened our positions in Defence & Security and established a presence in the Space segment, which has substantial growth potential. The purchases of Tobania and Ordina have given us a key presence in the Benelux market, with over 4,000 employees and around €700 million in revenue over the full year.

Lastly, I’m very proud to share that Sopra Steria has once again made the CDP(6) A List – recognising the world’s most transparent and most proactive companies in the fight against climate change – for the 7th year in a row.

Our priorities for 2024 are clear: successfully integrate the companies we have acquired, execute the recently announced plan to dispose of our banking software activities, speed up our internal transformation initiatives and boost our performance."

Consolidated revenue totalled €5,805.3 million, an increase of 13.8%. Changes in scope had a positive impact of €420.6 million, and currency fluctuations had a negative impact of €74 million. At constant exchange rates and scope of consolidation, revenue growth was 6.6%.

Operating profit on business activity came to €548.2 million, up 21.0% relative to 2022. The operating margin on business activity increased by 0.5 points to 9.4% (8.9% in 2022).

The France reporting unit (41% of the Group total), revenue grew sharply (16.9%) to €2,384.3 million. CS Group was consolidated in Sopra Steria’s accounts for ten months and contributed €257.4 million in revenue, posting 10.2% growth. Excluding changes in scope, organic growth came to 5.0%. Growth continued – albeit at a slower pace – in the fourth quarter, with organic growth running at 2.3%. The year’s best‑performing vertical markets overall were defence, aerospace and transport. The operating margin on business activity came to 9.6% (10.0% in 2022). As expected, the consolidation of CS Group had a dilutive effect on the operating margin on business activity for the financial year. The benefits of operational synergies are expected to show up from 2024.

Revenue for the United Kingdom (16% of the Group total) was €940.9 million, representing organic growth of 7.7%, driven by the aerospace, defence and security sector, which posted growth of 23.1%, as well as by NHS SBS and SSCL, the two business process services platforms for the public sector, which posted growth of 9.7% and 15.3%, respectively. The private sector posted full-year growth of 2.4%. The reporting unit’s operating margin on business activity improved by 0.5 points to 11.0%.

The Other Europe reporting unit (30% of the Group total) posted organic revenue growth of 18.6% to €1,746.9 million. At constant scope and exchange rates, revenue grew 8.8%. The fastest growth was seen in Scandinavia and Spain, which both posted double-digit growth. Following the consolidation of Ordina in the final quarter of 2023, Benelux contributed €309.7 million to full-year revenue, representing organic growth of 5.3%. The reporting unit’s overall operating margin on business activity was 8.7%, up 2.5 points from 2022 (6.2%).

Revenue for Sopra Banking Software (8% of the Group total) came to €445.1 million, representing organic growth of 4.8%, driven in particular by the digital solutions offered by Sopra Banking Platform and Sopra Financing Platform. This resulted in a 9.8% increase in subscription revenue. Software revenue was up 4.2% while services revenue grew 5.8%. The operating margin on business activity came to 5.4%, as anticipated, equating to a moderate decline from 6.5% in 2022.

The Other Solutions reporting unit (5% of the Group total) posted revenue of €288.2 million, representing organic growth of 5.9%. The Human Resources Solutions business grew by 6.7%. Property Management Solutions posted a 4.1% increase in revenue. The operating margin on business activity grew 0.7 points to 13.7% (13.0% in 2022). 

Profit from recurring operations came in at €467.2 million, equating to growth of 17.5%. It included a €43.0 million share‑based payment expense, the increase in which was largely due to increases in the Sopra Steria share price in financial year 2023. It also included a €38.0 million amortisation expense on allocated intangible assets.
 

Operating profit came to €329.9 million (compared with €361.3 million in 2022), after a net expense of €137.4 million for other operating income and expenses (€36.3 million in 2022), which included an €89 million asset impairment charge on Sopra Banking Software. This non-recurring charge has no impact on cash or on the dividend proposed in respect of financial year 2023.

Net interest expense was €35.9 million (versus €14.4 million in 2022), driven by the increase in financial debt relating to financing for acquisitions and higher interest rates.

The tax expense totalled €111.7 million, for an effective tax rate of 38.0%. Restated for non-recurring items, the normative tax rate for 2023 is estimated at 25%.

Net profit from associates amounted to profit of €6.7 million (compared with an expense of €14.7 million in 2022). 

Minority interests totalled €5.4 million. Since SSCL is wholly owned following the acquisition of the 25% interest previously held by the UK Cabinet Office, no minority interests were recognised.

Net profit attributable to the Group came to €183.7 million (€247.8 million in 2022).

Adjusted to exclude the impairment charge on Sopra Banking Software, net profit attributable to the Group would have been €272.7 million in 2023, 10.0% higher than in 2022.

Basic earnings per share came to €9.08 (€12.23 in 2022). Adjusted to exclude asset impairment, basic earnings per share would have been €13.48.

Free cash flow was very strong, at €390.2 million, in particular due to a 21.2% increase in EBITDA, strict management of the average payment period of trade receivables and early net inflows.

Net financial debt totalled €946.0 million. It included the impact of outflows related to the acquisitions of CS Group, Tobania, Ordina and SSCL. As at end-December 2023, it was equal to 49.1% of equity and 1.5x pro forma EBITDA for 2023 before the impact of IFRS 16 (with the financial covenant stipulating a maximum of 3x).

At the next General Meeting of Shareholders, Sopra Steria will propose the payment of a dividend(7) of €4.65 per share vs €4.30 per share in respect of financial year 2022.

At end-December 2023, the Group’s net headcount came to 55,833 employees, compared with 49,690 employees at year-end 2022. A total of 9,202 staff were employed at international service centres.

The workforce attrition rate was 14.0%, compared with 17.0% in 2022.

Sopra Steria sees its contribution to society as sustainable, human-focused and purposeful, guided by the firm belief that making digital work for people is a source of opportunity and progress.

With regard to the environment, CDP confirmed in February 2024 that Sopra Steria had made its A List – recognising the world’s most transparent and most proactive companies in the fight against climate change – for the 7th year in a row. This recognition notably reflects the Group’s new Net-Zero target(8) of achieving a 52% reduction in its greenhouse gas emissions from Scopes 1 & 2 and a 37.5% reduction for Scope 3 by 2030. As at end-December 2023, the Group had achieved a 63.6% reduction in Scope 1 & 2 emissions and a 9.8% reduction in Scope 3 emissions. The Group’s energy consumption, for example, was reduced by 20% relative to 2021.

In the social arena, progress was made on the Group’s gender equality policy in 2023, with a 0.4-point increase in the proportion of women in the workforce (33.5%), a higher proportion of women hired and promoted, and a 1.1-point increase in the proportion of women in the 10% most senior positions (21.5%).

With regard to human resources, the annual Great Place To Work survey conducted in 2023 found that 77% of employees say Sopra Steria is a great place to work, making the vast majority of the Group’s entities eligible for Great Place to Work® certification.

• ■Compound annual organic revenue growth of between 2% and 4%, including a relatively stable Q1;
• ■Operating margin on business activity of between 9.5% and 10.0%, including a dilutive effect of around 0.2 points related to recent acquisitions;
• ■Free cash flow in excess of €350 million

During financial year 2023, Sopra Steria announced the following key transactions:

• ■CS Group – On 28 February 2023, Sopra Steria Group SA acquired a controlling stake in CS Group. This acquisition followed the acquisition of a main block comprising 29.73% of the company’s share capital as well as the fulfilment of commitments made on 27 July 2022 to sell stakes comprising 29.15% and 6.38% of the company’s share capital. Following these acquisitions, and taking into account the 9.80% stake already held in the company, the Group held a controlling interest of 75.06% at 28 February 2023. The Group subsequently carried out a simplified public tender offer and a delisting offer. All of these transactions were carried out on the basis of a unit price of €11.50 per ordinary share. The Group held 100% of CS Group’s share capital at 31 December 2023.

• CS Group is a benchmark player in designing, integrating and operating critical systems in the fields of defence, security, space and nuclear energy. It also strengthens the Group’s positions in France in cybersecurity and aeronautics, as well as digital sovereignty and digital trust. It is part of the “France” cash‑generating unit.
• ■Tobania – On 2 March 2023, the Group completed the acquisition, through its subsidiary Sopra Steria Benelux, of 100% of the share capital of Assua NV and its operating subsidiaries Tobania NV and Python Predictions BV in Belgium. This business combination enables the Group to expand its coverage of digital services in the Belgian market and double its market share to become one of its main players. The companies acquired are part of the “Benelux” cash-generating unit.
• ■Ordina – Following the public tender offer launched on 19 July 2023, the Group acquired a controlling interest in Dutch digital services company Ordina on 4 October 2023. At 31 December 2023, it held 100% of the shares in this company. Ordina has operations in the Netherlands, Belgium and Luxembourg. Together with the Group’s businesses in Belux and those acquired from Tobania in Belgium, this combination creates a premier digital services partner in the Benelux region. The businesses and markets served by Ordina are very similar to those served by the Group. The Benelux region is now overseen from the Netherlands. Ordina belongs to the Benelux cash-generating unit.
• ■Connectiv‑IT – In France, on 4 April 2023, the Sopra Steria Group SA wholly acquired Connectiv‑IT, a French software developer specialising in supply chain management and ensuring operational readiness of equipment in the aeronautics and defence sectors.
• ■Marin IT – Sopra Steria AS, a Norwegian subsidiary of the Group, wholly acquired Marin IT in September. The company had previously been the IT services subsidiary of the Norwegian companies DOF Group ASA and Austevoll Seafood ASA.
• ■Sopra Steria Ré 2 – On 21 December 2023, Sopra Steria Group SA acquired Sopra Steria Ré 2, a reinsurance company.

A total of €54.1 million was invested in 2023 in infrastructure and technical facilities, as against €55.3 million in 2022.

Investments in facilities comprised the following:

• ■land and buildings: €0.1m;
• ■fixtures, fittings and furniture: €36.3m;
• ■IT: €17.7m.

• ■At 6:15 pm on 21 February 2024 – Sopra Steria announced the plan to sell to Axway Software most of Sopra Banking Software’s activities, which generate around €340 million in revenue, for an enterprise value of €330 million. Concurrently, the plan is to sell to Sopra GMT 3.619 million Axway shares previously held by Sopra Steria. The price tag for the sale will be €95.9 million or €26.5 per share.
  Sopra Steria’s business model is focused on independence and sustainable value creation for its stakeholders. As such, the Group is clarifying its strategy with the announcement of the plan to dispose of its banking software activities.
• The objective is to complete these transactions by the end of the second quarter of 2024 or during the third at the latest. These transactions will be subject to the requisite regulatory approvals, including a decision by the AMF not requiring a public offer to be filed, and the AMF’s approval of the prospectus to be filed by Axway in connection with its rights issue.

No other subsequent events occurred after the end of financial year 2023.

Sopra Steria Group’s governance consists of a Board of Directors, Chairman and Chief Executive Officer.

The organisation is supported by a permanent operational and functional structure as well as temporary structures for the management of particular deals and projects.

Sopra GMT, the holding company that takes an active role in managing the Group, takes part in conducting Group operations through:

• ■its presence on the Board of Directors and the three Board committees;
• ■a tripartite assistance agreement entered into with Sopra Steria and Axway, concerning services relating to strategic decision-making, coordination of general policy between Sopra Steria and Axway, and the development of synergies between these two companies, as well as consulting and assistance services, particularly with respect to finance and control.

The Group’s permanent structure is composed of four operational tiers and their associated functional structures.

Cyril Malargé has served as Chief Executive Officer since 1 March 2022.

The Executive Committee (ExCom) is led by the Chief Executive Officer and consists of the heads of the main operating and functional entities.

The 18 members of Sopra Steria Group’s Executive Committee supervise the Group’s organisation, management system, major contracts and support functions and entities. The Executive Committee is involved in the Group’s strategic planning and implementation. Three of its members are women.

• ■Cyril Malargé, Chief Executive Officer
• ■Laurent Giovachini, Deputy Chief Executive Officer, Defence & Security
• ■Éric Pasquier, Strategy, Software and Solutions
• ■Fabrice Asvazadourian, Sopra Steria Next
• ■Yvane Bernard-Hulin, Legal
• ■Éric Bierry, Sopra Banking Software
• ■Pierre-Yves Commanay, Continental Europe
• ■Dominique Lapère, Industrial Approach
• ■Axelle Lemaire, Corporate Responsibility
• ■Béatrice Mandine, Communications
• ■Jo Maes, Benelux
• ■Louis-Maxime Nègre, Human Resources
• ■John Neilson, United Kingdom
• ■Xavier Pecquet, Key Accounts and Partnerships, Aeroline
• ■Kjell Rusti, Scandinavia
• ■Mohammed Sijelmassi, Technology
• ■Étienne du Vignaux, Finance
• ■Grégory Wintrebert, France

The Group Management Committee consists of the members of the Group Executive Committee, together with 44 operational directors and functional directors. Nine of the Group Management Committee’s members are women.

These are the main operating entities. Their scope corresponds to one of the following:

• ■a specific line of business (consulting and systems integration, development of business solutions, infrastructure management and cloud services, cybersecurity services and business process services);
• ■geographic area (country).

These entities are managed by their own Management Committee, comprising in particular the Director and management of Tier 3 entities.

Each country or subsidiary is made up of divisions based on two criteria:

• ■vertical market;
• ■geographic area (region).

Each division is made up of business units, which are the organisation’s primary building blocks. They operate as profit centres and enjoy genuine autonomy. They have responsibility for their human resources, budget and profit and loss account. Management meetings focusing on sales and marketing strategy and human resources are held weekly, and the operating accounts and budget are reviewed on a monthly basis.

The diagram below illustrates the four main tiers of the ongoing structure:

The operational organisation is strengthened by operational support entities responsible for managing major transformations:

• ■the Key Accounts and Partnerships Department (DGCP), responsible for promoting the Key Accounts policy and developing relations with partners. The role of this department is to coordinate the commercial and production approaches for our major clients, particularly when different entities are involved;
• ■the Digital Transformation Office (DTO), responsible for designing and managing the Group’s digital transformation. It also manages the Group’s innovation approach;
• ■the Industrial Department, responsible for industrialising working methods and organising subcontracting on X-shore platforms. It also checks that projects are properly executed.

The Group’s functional divisions are the Human Resources Department, the Communications and Marketing Department, the Corporate Responsibility and Sustainable Development Department, the Internal Control Department, the Finance Department, the Legal Department, the Real Estate Department, the Purchasing Department, and the Information Systems Department.

These centralised functions ensure Group-wide consistency. Functional managers transmit and ensure commitment to the Group’s core values, serve the operational entities and report directly to Executive Management.

The Group’s functional structures standardise management rules (information system resources, IT systems, financial reporting, etc.) and monitor the application of strategies and rules. In this manner, they contribute to overall supervision and enable the operational entities to focus on business operations.

Sopra Steria manages complex and large-scale programmes and projects in a market where delivery commitments are increasing and becoming globalised. The Group has an increasingly wide range of skills to support multi-site projects that generate strong gains in productivity with delivery models that guarantee clients an optimal cost structure.

Sopra Steria applies an industrial production approach, supported by five levers:

• ■production culture: passing on know-how and expertise in the field;
• ■choice of personnel: human resources are central to the approach, providing training, support and improved skills for each employee;
• ■organisation: the Industrial Department and its representatives in the business units control production quality and performance, identify and manage risks, support project managers and roll out industrialised production processes;
• ■state-of-the-art industrial-scale foundation: the Delivery Rule Book (DRB), the Digital Enablement Platform (DEP) and the Quality System across the Group’s various entities;
• ■global delivery model: rationalising production by pooling resources and expertise within service centres, with services located based on the needs of each client (local services and skill centres in various entities, shared service centres nearshore in Spain and Poland, and offshore shared service centres in India).

The Group’s organisation must retain flexibility in order to adapt to changes in its markets and ensure the successful completion of projects.

These are handled by temporary teams:

• ■within the entities;
• ■under the authority of a pilot entity, established to leverage synergies across several entities.

Each project is organised and carried out in order to meet fundamental objectives: customer service, business success and contribution to the overall growth of the Group.

Depending on their particularities (size, area of expertise, geographic area covered), large-scale projects can be managed at the business unit, division, subsidiary/country or Executive Management level. Certain large projects requiring the resources of several business units may involve the creation of a division.

Within the Group, risk management plays an integral part in business management processes at all levels, from project units to the corporate level. Risks are first managed at a local level, in areas where they are likely to occur, before being considered on a global basis, in cases where they are managed at Group level, depending on the Group’s ability to take corrective action or to accept them. In any event, the level of risk must remain consistent with the Group’s plans, support its position and help it to achieve its medium-term growth objectives. Taking risks that potentially extend beyond the control of the entity concerned requires approval from a higher level. For example, in the case of business opportunities, local management must seek the Group’s opinion and support if the amounts involved, the lack of sufficient resources, the scale of the investment, the maturity and organisational framework of the client and/or changes to the business model are likely to have repercussions on the Group’s performance and/or reputation. The engineering methodologies used by the Group’s business lines are predicated on the risk-based approach, helping disseminate this culture of risk management.

Risks are therefore identified and the implementation of associated mitigation plans assessed and monitored on an ongoing basis by the various operational and functional units via the risk management system. This system, a pillar of the Group’s risk management system, is based on regular weekly, monthly and annual cycles that are followed at every level of the organisation, corresponding to monthly, annual and multi-year planning horizons (see description in Section 3.3.2 of this chapter, page 48). These cycles help the Group maintain an overall view that takes into account opportunities and risks at every level (strategy, market, operations, social, compliance, etc.). They are synchronised so as to facilitate higher-level consolidation.

Every year, when the annual cycles take place, information gathered at Group level is used to update the general mapping of risks. This exercise, coordinated by the Internal Control Department, consists of identifying the risks that could limit Sopra Steria’s ability to achieve its objectives and complete its corporate plan, as well as assessing their likelihood of occurrence and their impact.

Risks are assessed on a scale of four levels: low, medium, high, very high, in terms of likelihood; and minor, moderate, major, severe for impact. In terms of impact, several aspects are taken into account: the financial impact on operating profit, the level of operational disruption and the extent of reputational repercussions. As of this financial year, the time frame used is three years, instead of five years as was previously the case.

This analysis is based on contributors’ expertise, analysis of historical and forecast data and monitoring of changes in the external environment. The Group’s main operational and functional managers are involved through individual interviews and group validation workshops. The results are discussed in detail by the Group Executive Committee and then presented by the Internal Control Department to the Audit Committee of the Board of Directors.

The risk mapping covers all internal and external risks and includes both financial and non-financial issues. Non-financial risks are handled in the same way as other risks. Specific mapping for corruption and influence-peddling risks and risks relating to duty of vigilance are used in this general risk mapping.

The most significant risks specific to Sopra Steria are set out below by category and in decreasing order of criticality (based on the crossover between likelihood of occurrence and the estimated extent of their impact), taking account of mitigation measures implemented. As such, this presentation of residual risks is not intended to show all Sopra Steria’s risks. The assessment of this order of materiality may be changed at any time, in particular due to the appearance of new external factors, changes in operations or a change in the effects of risk management measures.

For each risk, a description is provided explaining in what ways it could affect Sopra Steria as well as the key risk management measures put in place, such as specific governance, policies, procedures, checks and action plans.

The table below shows the results of this assessment in terms of residual materiality on a scale of three levels, from least material () 
to most material ().

Due to rapid changes in technologies and ecosystems, it is important for the Group to transform and adapt itself at the right time so as to offer relevant solutions meeting the expectations of clients in the area of digital transformation. Clients are seeking to become more agile, and to do so they are frequently reinventing their business models, organisational structures and resources. These developments concern all of the Group’s businesses.

If the Group is unable to anticipate and adapt to these developments, an unsuitable positioning and/or difficulties in implementing its services and solutions strategy could significantly impact its financial performance and image, and ultimately call into question its strategy.

The Group’s development strategy is based in part on its ability to identify potential acquisition targets and integrate them into all the services and solutions it offers, whether to supplement or improve them. Any major difficulty in integrating companies, generating the expected synergies, retaining staff of acquired entities or achieving a return on these acquisitions in future could have a negative impact on the Group’s financial results and outlook.

In general, the uncertain economic situation in Europe as well as possible consolidation within the various business sectors of Sopra Steria’s customers, or a slowdown in the business activity of a specific client or major sector, could have a negative impact on the Group. A downward trend in macro-economic indicators, high inflation leading to higher interest rates, and rising energy costs all contribute to increasing this risk.

To cope with these budgetary pressures, a major client or even the entire sector could be forced to curtail IT investment projects, resulting for the Group in the loss of associated revenue and requiring the reassignment of the teams in place, a risk all the more difficult to manage if the downward fluctuations could not have been predicted.

Main clients include Airbus Group, Banque Postale, BNP Paribas, CNAM, Crédit Agricole, the UK Department for Work and Pensions, EDF, the UK Home Office, the UK Metropolitan Police, the French Ministry of the Economy, Finance and Industrial and Digital Sovereignty, the French Ministry of the Interior and Overseas Territories, the French Ministry of Justice, the French Ministry of the Armed Forces, the UK Ministry of Defence, the UK Ministry of Justice, the UK National Health Service, Orange, SNCF, Société Générale and Sparda Banken.

In 2023, the Group’s top client accounted for 8.7% of revenue, the top five clients represented 21.1% and the top ten contributed 31.4%.

Given its size, multiple geographical locations and positioning in projects at the heart of the clients’ information systems and visible projects for end clients (e.g. platform activities in the United Kingdom, major public sector transformation projects, payroll outsourcing activities), the Group could become increasingly exposed to the circulation of negative, unsubstantiated information in the media, potentially amplified by external or internal stakeholders in the press or on social media.

If the Group were to be the object of harmful media coverage or negative messages, this could have an adverse impact on its image and attractiveness and have repercussions on its financial performance.

The Group may need to deal with the consequences of major external crises that could potentially disrupt its operations. This could be a systemic event such as a political or social crisis profoundly changing business conditions in one or more countries in which the Group operates, a major public health crisis, natural phenomena relating to climate change, whose frequency will surely increase, a global cyberattack or a major incident making the Group’s physical and/or IT and communication infrastructures widely unavailable.

Failings in prevention plans and/or crisis management processes or an inappropriate response to the crisis could have very major repercussions on an economic and operational level and seriously damage the Group’s reputation.

A phishing campaign or the exploitation of a security flaw in the technical infrastructures or solutions used by Sopra Steria are examples of cyberattacks. They could result in a breakdown or impairment of essential systems for activities contractually agreed with clients and/or for the Group’s internal operations, or the loss, corruption or disclosure of data. A cyberattack on a client, even if indirectly caused by a service provided by the Group, could also have major repercussions for Sopra Steria.

This risk inevitably increases in the context of accelerated digital transformation (including services hosted in the cloud and mobile technologies). Widespread changes in work models since the public health crisis are also a factor that increases cyberthreats. Cyberattacks by malicious actors (hackers, criminal organisations and state-backed organisations) have increased steadily. The use of artificial intelligence could affect how often they occur and how sophisticated they become through dedicated illegal marketplaces. This trend is likely to increase in the future. The stakes were also raised by heightened geopolitical tensions and increased attacks on global infrastructure by cyber activists.

These risks are significant in terms of both their probability and their impact and are at the heart of Sopra Steria’s strategic concerns. Their potential impacts include the financial implications of client claims relating to contractual commitments, the interruption of internal operations, high incident recovery costs and regulatory non-compliance as well as reputational damage for the Group and the potential loss of future contracts.

For fixed-price projects and managed or operated services, lack of quality or failure to meet the standards expected of services and defined in contracts may give rise to various risks for Sopra Steria, such as additional costs, contractual penalties, client complaints, claims for damages, non-payment, early contract termination and reputational risk. These types of projects and services account for more than two-thirds of the Group’s consolidated revenue.

In the current environment, clients’ demands are becoming increasingly complex due to speed of execution, the agility required and the technical nature of solutions, as well as due to regulated environments, for example for the financial sector. These demands increasingly factor in corporate responsibility, particularly in terms of reducing the environmental impact of information systems developed or managed.

A poor assessment of the scale of the work to be done, an underestimate of the cost of providing the service or an incorrect estimate of the technical solutions to be implemented can lead to estimated costs being exceeded or contractual deadlines not being met. This delay can, in itself, result in penalties and/or budget overruns, resulting in additional costs and potentially impacting operating margins.

Sopra Steria Group places its employees at the centre of its corporate plan. Its growth objectives must be achieved against the backdrop of scarcity of expertise and increased demands of applicants and employees in terms of quality of life at work, work-life balance, and responsible commitments and sustainability, particularly to limit the environmental impact of operations. This trend is also supported by the development of digital technology (connectivity, collaborative platforms, etc.), which transforms uses and minimises a certain number of constraints, in particular geographical constraints or in relation to physical proximity.

Being unable to optimise recruitment systems as much as is required could compromise our ability to attract the talent we need and could result in the Group’s strategy, growth and financial performance not being achieved as intended.

Developing the skills of our employees and managers and being able to retain key talent are essential factors in adapting the Group to its business challenges. They also help to make the Group more resilient and competitive in the face of current and future changes.

Difficulties in providing training that is both aligned with the needs of our clients and on a pragmatic level adapted to the necessary adjustment of our organisation and systems could call into question the Group’s ability to serve its strategy and economic targets. The same would apply if the Group had to deal with excessively high, unmanaged employee turnover.

The Group operates in many countries, serving customers with international presences, and is therefore subject to various constantly changing laws and regulations. These may be regulations concerning data protection, anti-corruption laws, competition law, international sanctions, employment law or employee health and safety obligations, environmental regulations within the framework of combating climate change, and tax reforms.

The Group’s activities and operating profit might be affected by significant changes in laws or regulations, or by decisions taken by authorities. The Group is also exposed to the risk of breaches of regulations by employees who are not well enough informed or negligence or fraud by the employees.

The Group’s insurance policy is closely linked to its risk prevention and management practices, in order to ensure coverage for its major risks. The Group’s Legal Department is responsible for the centralised management of its insurance programme.

The aim of Sopra Steria Group’s international insurance programmes is to provide, in compliance with local regulations, uniform and adapted coverage of the risks facing the company and its employees for all Group entities at reasonable and optimised terms. With this in mind, the Company set up its own captive reinsurance company in late 2021.

The scope and coverage limits of these various insurance programmes are reassessed annually in light of changes in the size of Sopra Steria Group, developments in its business activities as well as changes in the insurance market and based on the results of the most recent risk mapping exercise. The insurance programmes provide sufficient coverage for risks with high financial stakes.

All Group companies are insured with leading insurance companies for all major risks that could have a material impact on its operations, business results or financial position. Companies acquired during 2023 have been included in these programmes.

The most significant insurance programmes are:

• ■premises and operations liability and professional indemnity insurance:
  • ●this programme covers all of the Group’s companies for monetary consequences arising as a result of their civil and professional liability in connection with their activities, due to bodily injury, material or non-material damage caused to its clients and third parties;
• ■property damage and business interruption insurance:
  • ●this programme covers all of the Group’s sites for the direct material damage to property they may suffer as well as any consequential losses in the event of reduced business activity or business interruption occasioned by the occurrence of an insured event.

Other insurance programmes have also been put in place to cover, among other things, cyber risks, fraud, employer liability and civil liability of senior executives, company officers and employees on business trips.

This section of the report outlines Sopra Steria’s internal control and risk management systems. These systems are based on the reference framework issued by the AMF. A specific subsection addresses the preparation of accounting and financial information.

The management control system is one of the fundamental components of internal control at Sopra Steria Group. It supports risk management and the internal dissemination of information as well as the various reporting procedures and the implementation of controls.

In order to address the identified risks presented in the preceding chapter, Sopra Steria has adopted a governance approach as well as a set of rules, policies, procedures and checks together constituting its internal control and risk management system.

In accordance with the AMF reference framework, the internal control and risk management system, which is under the responsibility of the Group’s Chief Executive Officer, is designed to provide reasonable assurance regarding the achievement of objectives in the following categories:

• ■compliance with laws and regulations;
• ■implementation of instructions, guidelines and rules set forth by Executive Management;
• ■proper functioning of the Company’s internal processes, particularly those intended to safeguard its assets;
• ■quality and reliability of financial and accounting information.

The risk management system is designed to identify, analyse and manage the Company’s main risks.

More generally, the Group’s internal control and risk management system contributes to the control of its business activities, the effectiveness of its operations and the efficient use of its resources.

This system is updated on a regular basis, in application of a continuous improvement process, in order to best measure the level of risk to which the Group is exposed as well as the effectiveness of the action plans put in place to mitigate risks.

Nevertheless, the internal control and risk management system cannot provide an absolute guarantee that the Company’s objectives will be achieved and that all risks will be eliminated.

The Sopra Steria Group refers to the reference framework issued by the Autorité des Marchés Financiers (AMF, the French securities regulator).

The internal control and risk management system applies across the entire Group, i.e. the parent company Sopra Steria Group, together with all companies controlled by the Group.

Sopra Steria’s internal control and risk management system is founded upon the Group’s four-tier operational organisation as well as its centralised functional organisation. Each tier of the operational organisation is directly involved in the implementation of internal control and risk management practices. To this end, the Group has put in place a set of operating principles and rules, along with the appropriate delegations of authority. It is the responsibility of all Group employees to familiarise themselves with these rules and to apply them. For more information on the Group’s organisation, see Section 9, “Group organisation” of Chapter 1, “Business overview and strategies” of this Universal Registration Document (pages 36 to 37).

The management control system is designed not only to manage the dissemination of information, upwards to Executive Management and downwards to the operational and functional units, but also to guide, control and support the Group’s employees at every level. It involves steering meetings held at each of the different organisational levels, including the Group’s Executive Committee.

The management control system is the backbone of risk management within the Group, ensuring that risks are identified, assessed and managed at the right level of the organisation, ranging from specific contracts or projects to the overall issues affecting the Group, followed by the implementation of procedures to track progress on the related action plans.

These cycles are governed by specific standards (reporting timetable, participants, agenda, documents to be presented at the beginning and end of the meeting) and are supported by the management reporting system. Meetings are held according to a calendar, dependent on the organisational level and timeframe objectives:

• ■weekly meetings for the current month: Priority is given to the monitoring of sales, production and human resources;
• ■quarterly meetings for the current year: In addition to the topics covered at the weekly meetings, additional emphasis is placed on financial indicators (entity performance for the previous month, update of annual forecasts, actual vs. budget, progress report on actions in line with the medium-term strategy);
• ■annual meetings, looking ahead several years: The medium-term strategy and the annual budget process for the entities are discussed in the context of the Group’s overall strategic plan.

The implementation of this system at all operational and functional entities is a highly effective vehicle for cohesiveness, the sharing of values and practices throughout the Group, and control.

The Group’s communication and management applications are designed to standardise the documents produced by the Group. The production tools used or developed by the Group allow for the industrialisation of project delivery and of managed or operated services by improving the quality of deliverables.

The aims of the Group’s Code of Ethics, which is based on its core values, are to ensure compliance with international treaties, laws and regulations in force in all countries where Sopra Steria operates, and to reaffirm the Group’s ethical principles. This Code of Ethics is supplemented by a code of conduct for stock market transactions whose main aim is to reiterate the rules regarding insider information and the management of the company’s shares. In addition, the Anti-Corruption and Influence-Peddling Code of Conduct sets out the rules and behaviours to be adopted to prevent corruption and influence peddling. For more details on the Anti-Corruption and Influence-Peddling Code of Conduct, see Section 4.1, “Putting our values into effect and ensuring the compliance of our actions” in Chapter 4, “Corporate responsibility” of this Universal Registration Document, pages 167 to 172.

The framework of internal control rules, known as the Group Rules, constitutes the common core of operating rules applicable to all entities and is rolled out as early as possible in the integration process whenever a new company is acquired. With the aim of continuously improving internal control and better managing risks identified through the Group’s various risk mapping exercises, the Group Rules are regularly reviewed to ensure they remain relevant and supplemented to take into account, in particular, segment-specific developments, regulatory changes and internal audit findings.

The Group Rules include 164 items covering 14 areas corresponding to Group processes: governance and steering, human resources, pre-sales and contracting, production, information systems security, site management and security, purchasing, finance, legal structure of entities, insurance, mergers and acquisitions, corporate responsibility, marketing communications, and compliance. These rules may be adapted to suit the Group’s different geographies and subsidiaries provided they remain consistent with the framework laid down.

These fundamental rules are then broken down for each area in the form of detailed policies and procedures (e.g. Delivery Rule Book, Human Resources Policy, Information Security Policy, Purchasing Procedure, M&A Playbook, etc.). They are available on the Group’s intranet and are reinforced through the Group’s various training and communications initiatives.

As regards the production front, Sopra Steria’s Delivery Rule Book defines all the pre-sales, production, quality assurance and security processes required to successfully manage projects. The primary goal is to contribute effectively to producing the expected level of service that meets clients’ needs in line with time and budget constraints. It defines project management practices and processes suited to various environments and at different levels of management and supervision, as well as software engineering practices and processes. The Delivery Rule Book sits above all the Group’s quality systems. All quality systems in use within the Group are compatible with the Delivery Rule Book. The basic principles of the Quality Systems are described in a Quality Manual supplemented by procedural guides and operating manuals.

Everyone in the Group has a part to play in risk management and internal control, from the governance bodies and senior management to the employees of each Group company.

The internal control and risk management system is approved and overseen by Executive Management, thus at the Group’s highest level. As the top level of authority and responsibility for the internal control and risk management system, it monitors the system’s continuing effectiveness and takes any action required to remedy identified shortcomings and remain within acceptable risk tolerance thresholds. Executive Management ensures that all appropriate information is communicated in a timely manner to the Board of Directors and to the Audit Committee.

The Group’s Audit Committee is regularly informed of the main features of and changes to the internal control and risk management procedures selected and implemented by Executive Management to manage risks, including the organisation, roles and functions of the key actors, the approach, structure for reporting risks and monitoring the effectiveness of control systems. It has access to the elements necessary to reach an overall understanding of the procedures relating to the preparation and processing of accounting and financial information (presented in the following chapter).

Each year, the Audit Committee reviews the results of the Group’s risk mapping exercise and holds regular meetings with the Internal Control Department to monitor the implementation and adaptation of the Group’s rules and the internal control process.

The Audit Committee also monitors the activity of the Internal Audit Department through the following actions:

• ■approval of the annual internal audit plan;
• ■meeting with its Director once a year in the presence of the Statutory Auditors, but without the presence of management;
• ■biannual review of the results of internal audit assignments and follow-up on the implementation of action plans resulting from recommendations;

In accordance with the AMF reference framework, the internal control and risk management system put in place by Sopra Steria Group is structured around three lines of control, as presented below:

• ■First line of control: Front-line staff and operational management.
• The first line of control for the internal control and risk management system consists of:
  • ●operational management, tasked with implementing the system defined at Group level for the area under its responsibility. This line of control makes sure that the internal control rules and procedures are effectively implemented, fully understood and consistently applied within its scope of operations,
  • ●the Group’s employees, who take due note of and apply all of the rules set out within the organisation;
• ■Second line of control: Risk management and internal control.
• The aim of the second line of control is to monitor the internal control and risk management system on an ongoing and continuous basis to verify its effectiveness and coherence as well as the proper application of its rules and procedures.
  • ●Internal Control Department and network of Compliance Officers at the entities.

The internal control and risk management system is steered and coordinated by the Internal Control Department at Group level. In the context of risk management, it takes charge of the annual general risk mapping exercise, first by consolidating the information received from operational entities and functional departments and then by coordinating the necessary adjustments at the Group’s highest level. It monitors the action plans implemented as part of the Group’s risk management process, paying particular attention to those relating to its key risks. The integration of specific risks with the Group’s general risk mapping process (for example, corruption and influence-peddling risks, information systems security risks, risks relating to the duty of vigilance) and ensuring the overall consistency of the mapping process are also among its responsibilities in this area.

With regard to the risks that have been identified and assessed, the Internal Control Department defines and adapts the internal control system’s various components. In carrying out these duties, it works closely with all the Group’s functional and operational departments. The Corporate Internal Control Department consists of a team of four people.

The Group also has a network of Compliance Officers, appointed in each of the Group’s subsidiaries and entities. In 2023, there were 16 Compliance Officers. In the largest entities, they are assisted by a deputy, which is the case, for example, in France, the United Kingdom and Germany. Working alongside the Director of the subsidiary/entity, the Compliance Officer has a comprehensive overview of the main risks and the internal control systems within their entity. They are responsible for adapting the guidelines and rules defined at Group level. In particular, they are tasked with making sure that all components of the internal control and risk management system as well as those of the Group’s compliance programme are effectively implemented, fully understood and consistently applied. They are also responsible for raising alerts in the event of difficulties encountered in the implementation of any of these components for their scope. In addition, they are authorised to assess internal control issues, ensuring that they are taken into account where necessary by the operational and functional departments concerned. They are also responsible for making decisions and/or ensuring that decisions are made by the appropriate parties, if necessary, and for determining priorities. They perform this role on a part-time basis, devoting between 15% and 30% of their time depending on the size of the entity, alongside their main role. Their appointment is subject to approval by Executive Management. Seniority and in-depth knowledge of the entity’s operational activities feature among the selection criteria.

The Internal Control Department, supported by entity-level compliance officers, oversees monitoring activities of Group rules to ensure that they remain relevant and that any corrective action identified is properly implemented. Risk assessment campaigns are organised on a regular basis at the level of operational entities and functional departments, applying a methodological approach that combines self-assessment via questionnaires with joint assessments carried out in conjunction with the Internal Control Department.

• ●Functional departments

The functional departments are key participants in the coordination of the internal control and risk management system. They assist the Internal Control Department in updating internal control guidelines specific to the processes under their responsibility.

Alongside the self-assessment and control procedures implemented by operational managers at every level, functional departments play a special role in the application of the rules for delegations of authority in force within the Group. They support operational staff in the area of risk management and, from a preventive standpoint, they may serve in an advisory capacity or perform ex-ante or detective controls on the application of rules.

The Finance Department is entrusted with specific responsibilities in the context of financial controls and the Industrial Department is responsible for control procedures relating to the management of its Quality System.

• ●Finance Department

Financial Controlling falls under the responsibility of the Finance Department. Its main responsibilities include the consolidation and analysis of monthly results produced by the internal management system, controlling the consistency of quarterly forecasts, verifying the application of Group rules within their scope, assisting operational managers, training management system users, and performing the reconciliation between the internal management system accounts and the general ledgers.

As part of their control responsibilities, Financial Controllers identify and measure risks specific to each operational unit. In particular, they ensure that contractual commitments and project production are aligned with the revenue recognised. They raise alerts for projects that present technical, commercial or legal difficulties. They check that revenue is recognised in line with Group accounting rules as well as analysing any commercial concessions applicable and verifying their treatment in the operating accounts of the operational unit. They also ensure that the project and structure costs for the operational unit are completely and accurately recognised.

Financial Controllers devote particular attention to unbilled revenue and contractual milestone payments, and check that invoices issued are paid. In coordination with the manager at the relevant entity, they trigger payment collection, which is managed directly by the Finance Department. They check any credit notes issued.

Financial Controllers assess the organisation and administrative functions of operational units. They monitor compliance with deadlines in particular.

• ●Industrial Department

Delivery operations are supervised by the Industrial Department (ID). Its main duty is to monitor the quality of the services delivered, with particular emphasis placed on projects involving commitments, the level of operating margin generated by these services and the management of the associated operational risks. The ID provides the methods and industrial tools required to complete projects in accordance with the applicable standards. It also ensures that key personnel are appointed to oversee the management control system for services.

Sopra Steria’s Industrial Department is independent of the project management and delivery operations. As such, it offers external quality assurance monitoring for projects with the objectives of assuring production and cost controlling, overseeing associated human resources, verifying production conformity and compliance with quality assurance procedures, and monitoring the plan’s effectiveness.

Industrial managers under the authority of business unit/subsidiary managers and reporting functionally to the Group Industrial Department are responsible for monitoring the Quality System and all projects.

Reviews are performed so as to verify the application and effectiveness of the Quality System among the Group staff members concerned (management, sales, operational quality unit). Projects are reviewed on a regular basis, at key phases in their life cycle. Depending on how critical the projects are or the situation of the subsidiaries, they are organised either by the Group’s ID or by its quality structure’s local representatives. These reviews provide an external perspective on the status and organisation of projects.

Monthly steering meetings facilitate an overview of quality at all levels, the monitoring of annual quality targets established during management reviews and the determination of the appropriate action plans to continuously improve production performance and the quality of Sopra Steria products and services.

The effective implementation of actions agreed during steering meetings, audits and reviews is checked by the Industrial Department.

The Group has put in place a certification policy, covering all or a portion of its operations, depending on market expectations. This policy relates to the following standards or frameworks: ISO 9001, TickIT Plus, ISO 27001, ISO 22301, ISO 14001, ISO 20000, CMMI and TMMi.

• ■Third line of control: Assessment of the internal control system.
  • ●Internal Audit Department.

Under the internal audit charter adopted by the Group, the Internal Audit Department has the following tasks:

• ■independent, objective evaluation of the effectiveness of the internal control system via a periodic audit of entities;
• ■formulation of all recommendations to improve the Group’s operations;
• ■monitoring the implementation of recommendations.

The work of the Internal Audit Department is organised with a view to covering the “audit universe” (classification of key processes) reviewed annually by the Audit Committee.

Internal Audit covers the entire Group over a cycle of a maximum of four years. They are performed more frequently for the main risks identified. To this end, Internal Audit carries out field audits and can use self-assessment questionnaires for areas of lesser importance.

By carrying out work relating specifically to fraud and corruption, the Internal Audit Department has identified processes that are potentially concerned, associated risks, control procedures to be adopted (prevention and detection) and audit tests to be carried out. These are integrated into internal audit programmes.

Internal Audit, which reports to the Chairman of the Board of Directors and operates under the direct authority of Executive Management, is responsible for internal control and monitors the system in place. It submits its findings to Executive Management and the Audit Committee. The Internal Audit Department consisted of a team of seven people at end-2023.

The Chairman of the Board of Directors validates the audit plan, shared with Executive Management, notably on the basis of risk information obtained using the risk mapping procedure, the priorities adopted for the year and the coverage of the “audit universe”. This plan is presented to the Audit Committee for review and feedback. Recommendations are monitored and compiled in a report provided to Executive Management and the Audit Committee.

The Internal Audit Department carried out 18 assignments in financial year 2023.

• ●External monitoring system

Furthermore, the internal control and risk management system is also monitored by the Statutory Auditors and the quality certification inspectors for the Quality System.

As part of their engagement, the Statutory Auditors obtain information on the internal control system and the procedures in place. They attend all Audit Committee meetings.

The Statutory Auditors are engaged throughout the year across the Group. Their involvement is not limited to interactions with the accounting department. To gain a more in-depth understanding of how operations and transactions are recorded in the accounts, the Statutory Auditors are in regular contact with operational managers, who are best placed to explain the Company’s business activity. These meetings with operational staff are structured around business unit, division or subsidiary reviews, during which the Statutory Auditors examine the main ongoing projects, progress made and any difficulties encountered by the business unit or subsidiary.

The audit procedure aims to ensure that the Quality System is both in compliance with international standards and is applied to the entire certified scope of operations.

Each year, quality certification inspectors select the sites to be depending upon an audit cycle and relevance of the activity in relation to the certification.

The purpose of this audit process is to identify ways in which the quality management system might be improved in order to ensure continuous improvement.

The internal control system and its operation are subject to internal and external assessments to identify areas for improvement. These may lead to implementation of action plans to strengthen the internal control system, under the oversight of the Group’s Audit Committee.

By keeping the number of legal entities, and therefore accounting entities, relatively low, the Group can drive reductions in operating costs and minimise risks.

The activities of Sopra Steria’s accounting and finance function are overseen by the Group’s Finance Department, which reports directly to Executive Management.

The responsibilities of the Group Finance Department mainly include the production of the accounts, financial controlling, tax issues, financing and cash management, and participation in financial communications.

Each subsidiary has its own finance team that reports functionally to the Group’s Finance Department.

The Finance Department reports to the Group’s Executive Management. As with all other Group entities, it follows the management reporting and controlling cycle described above: weekly meetings to address current business activities, monthly and quarterly meetings devoted to a detailed examination of figures (actual and forecast), the organisation of the function and the monitoring of large-scale projects.

Executive Management is involved in the planning and supervision process as well as in preparing the period close.

The Board of Directors is responsible for the oversight of accounting and financial information. It reviews and approves for publication the interim and annual financial statements. It is supported by the Audit Committee, as described in Section 1.3.3, “Committees of the Board of Directors” of Chapter 3, “Corporate governance” of this Universal Registration Document (pages 84 to 87).

The configuration and maintenance of the accounting and financial information system are centralised at Group level. Central teams manage access permissions, and update them at least once a year. The granting of these permissions is validated by Finance teams at the subsidiaries.

All Group companies prepare, at a minimum, complete quarterly financial statements on which the Group bases its published quarterly revenue figures and interim financial statements.

Monthly cash flow forecasts for the entire year are regularly prepared for all companies and consolidated at Group level.

The accounting policies applied within the Group are presented in the notes to the consolidated financial statements in this document. At each balance sheet date, the Audit Committee ensures that these policies and presentation have been applied by the Finance Department and the Statutory Auditors.

The proper use of the percentage-of-completion method to value ongoing projects is monitored on a permanent basis jointly by the Industrial Department and by the Finance Department (Financial Controllers).

All Group entities prepare a monthly budget, a monthly operating statement and revised quarterly forecasts.

The budget process, which is short in duration, takes place in the last quarter of the year. This is a key stage. It provides an opportunity to apply the strategy approved by the Group’s Executive Committee, to adapt the organisation to developments in business segments and market demand, and to assign quantitative and qualitative objectives to all Group entities. Budgets, including detailed monthly operating forecasts, are prepared by each unit at this event.

Each Group entity prepares a monthly operating statement closed every month. Management indicators (utilisation rate, selling prices, average salary, indicators relating to human resources, invoicing and receipts, etc.) are also reviewed on a monthly basis.

Finally, a revised operating statement prepared each quarter includes the results of the previous months and a revised forecast for the remaining months of the current year.

Sales metrics (prospects, contracts in progress, signings, etc.), client invoicing and cash receipts are analysed at the management meetings organised by the management control system described above.

The results derived from the management reporting documents are verified by Financial Controllers reporting to the Finance Department, who also reconcile this data with the quarterly accounting results in the general ledgers.

Every quarter, each company establishes financial statements and prepares a consolidation pack.

For each of the companies falling within the scope of the audit of consolidated financial statements, the Statutory Auditors examine the interim and annual consolidation packs. Once approved, they are used by the Group Finance Department and the consolidated financial statements are examined by the Group’s Statutory Auditors.

The interim and annual consolidated financial statements are presented to Executive Management by the Finance Department.

As part of their annual accounts close-out at 31 December, the financial statements of Sopra Steria Group and its subsidiaries undergo a legal audit by the Statutory Auditors in order to be certified. A limited review is also performed on 30 June.

As part of its assignment to monitor the statutory audit of the financial statements, the Audit Committee takes note of the Statutory Auditors’ work and conclusions during the review of the interim and annual financial statements.

The Audit Committee examines the financial statements, notably in order to review the Company’s exposure to risks, verify that the procedures for gathering and controlling information guarantee its reliability, and ensure that accounting policies have been applied consistently and appropriately. It gathers comments from the Statutory Auditors.

The Group’s financial statements are then presented to the Board of Directors for approval.

The Financial Communications and Investor Relations Department, which is supervised by the Chairman of the Board of Directors, manages the Group’s financial communications.

The Group communicates financial information via several different means, notably:

• ■press releases;
• ■the Universal Registration Document and the various reports and disclosures that it contains;
• ■the presentation of the interim and annual financial statements.

The Group’s website has a dedicated “Investors” section that presents all of the aforementioned items as well as other regulatory or informative items.

This chapter describes the organisation and operation of governance as well as the compensation policy for company officers and its application during financial year 2023. It lists and explains any points of divergence from or partial compliance with the recommendations of the AFEP-MEDEF Code. (1)

On 19 June 2012, the Board of Directors decided to separate the roles of Chairman and Chief Executive Officer. It confirmed this decision in 2018 and 2021. It believes that this separation of roles remains the best way of addressing the Group’s strategic and operational priorities. Given the close relationship between the Chairman of the Board of Directors and the Chief Executive Officer, there is close collaboration and an ongoing dialogue between them. In summary, the current framework contributes to fluid and flexible governance arrangements. It means that the Group is able to act as quickly as needed and ensures decisions are taken with due care, while taking into account strategic priorities.

The Chairman is tasked with managing strategy, while the Chief Executive Officer is responsible for operations.

The Chairman:

• ■guides the implementation of the Group’s strategy and all related matters, including mergers and acquisitions;
• ■assists Executive Management with the transformation of the Group;
• ■oversees investor relations and manages the Board’s relations with shareholders.

The Chief Executive Officer:

• ■works with the Chairman to formulate strategy;
• ■supervises the implementation of decisions adopted;
• ■ensures the operational management of all Group entities.

The Nomination, Governance, Ethics and Corporate Responsibility Committee conducts an annual review of the succession plan for the Chairman of the Board of Directors and the Chief Executive Officer so any unforeseen vacancies can be dealt with appropriately. As part of this process, it meets with the Chairman of the Board of Directors. It makes sure the plan covers existing requirements and the Group’s culture. It assesses the relevance of the proposed changes. It approves the actions laid down in the short- to medium-term plan.

Pierre Pasquier is currently serving as Chairman of the Board of Directors.

The Chairman of the Board of Directors carried out activities on a full-time basis throughout the year. This involved steering the work of the Board and other assignments entrusted to him.

The Chairman’s assignments include the governance of strategy, acquisitions and the Board of Director’s shareholder relations. He is involved in several key areas that will shape the Group’s future and transformation (HR, digital and industrial transformation; key organisational and operating principles; employee share ownership; promotion of Group values and compliance). These matters were approved by the Chief Executive Officer at the beginning of the year.

The Chairman is responsible for maintaining balance between the Group’s various stakeholders: shareholders, employees and the community. He ensures that the social and environmental implications of the Group’s business activities are suitably taken into account.

In crisis situations, the ability to rank priorities, uphold the Group’s values, and consider its options from a longer-term perspective thanks to the commitment provided by the core shareholder is absolutely critical.

The various matters placed under the Chairman’s responsibility require a perfect knowledge of operational realities. Close relations with the Chief Executive Officer and the Executive Committee foster information flows between them. It facilitates effective coordination on: 

• ■decisions required for the delivery of the medium-term strategic plan;
• ■monitoring of the implementation of such decisions over the long term.

The separation of the roles of Chairman and CEO is based on:

• ■the roles defined in the internal rules and regulations of the Board of Directors;
• ■compliance with the respective prerogative powers of the Chairman and the Chief Executive Officer;
• ■a trust-based relationship established over the long term;
• ■a very good fit between the holders of the two positions.

In carrying out all of his assignments, the Chairman seeks out advice from former executives and may draw on certain resources across the Group. He is supported by a permanent team at Sopra GMT, the holding company that manages and controls the Group.

Of the four Sopra GMT employees, three of them have spent much of their careers with Sopra Steria Group. This team therefore has knowledge of the Group, its main managers and its organisational structure that an external service provider could not have. Its position within Sopra GMT means this team has an outside perspective and greater independence. These resources enhance the Board of Directors’ ability to oversee the smooth running of the Company.

The team was initially formed when Axway Software was spun off. It performs duties for Sopra Steria Group and Axway Software, in which Sopra Steria Group holds an ownership of approximately 32%. Sopra GMT provides both companies with its support and ensures synergies and best practices are implemented.

The members of this team carry out duties not undertaken by Sopra Steria Group: oversight of acquisitions, corporate secretarial affairs for the Board of Directors and its Committees. They may also assist the Sopra Steria Group’s functional divisions. They are also active participants in various steering committees (acquisitions, corporate responsibility, internal control, internal audit, employee share ownership). They may join working groups tackling key issues for the Company. They provide the benefit of their technical expertise and an independent opinion.

The costs rebilled by Sopra GMT comprise the portion of payroll and related personnel costs allocated to the assignments performed for Sopra Steria Group. They also comprise, under the same conditions, any external expenses incurred by Sopra GMT (such as specialised advisors’ fees). As such, this organisational method does not increase the expenses borne by Sopra Steria Group. If the assignments handled by Sopra GMT’s employees were not entrusted to them, they would need to be reallocated within Sopra Steria Group.

Pierre Pasquier’s compensation at Sopra GMT reflects his oversight of the assignments performed by the Sopra GMT team for Sopra Steria Group and Axway Software. It is not rebilled to these two companies.

Sopra Steria Group charges Sopra GMT fees for providing premises, IT resources, and assistance from the Group’s functional divisions as well as provision of appropriate expertise for Sopra GMT’s assignments.

The work performed by this team and the principle for the rebilling to the Company of the costs incurred are covered in a framework agreement for assistance. The General Meeting approved the implementation of this related-party agreement. The Board of Directors reviews it annually.

Around 85% of Sopra GMT’s total operating expenses are rebilled. The remaining 15% comprises the expenses arising from Sopra GMT’s own internal operations. Expenses are rebilled on a cost-plus basis including a 7% margin. By definition, Sopra GMT generally records a small operating loss. The annual breakdown varies according to the respective needs of Sopra Steria Group and Axway Software. On average, since 2011, two thirds of the rebilling have concerned Sopra Steria Group.

Sopra Steria Group recorded the following income and expenses under this agreement in 2023:

• ■expenses: €1,874 thousand;
• ■income: €165 thousand.

The Board of Directors reviewed the implementation of this agreement at its meeting on 25 January 2023. It unanimously agreed to maintain the previously granted authorisation for the current financial year. The members of the Board of Directors associated with Sopra GMT (Pierre Pasquier, Eric Pasquier, Kathleen Clark) did not take part in the discussion or vote on this decision and all other directors were present.

Cyril Malargé has served as Chief Executive Officer since 1 March 2022.

Cyril Malargé has been with the Company for almost 20 years. He first served as Managing Director of the France reporting unit. For the 18 months prior to his appointment as Chief Executive Officer, Cyril Malargé also served as the Group’s Chief Operating Officer. He has been a member of the Executive Committee since 2015.

The Chief Executive Officer has authority over the entire Group. He directs, administers and coordinates all of its activities. To this end, he is supported by Executive Management, the Executive Committee and the Management Committee. These Committees comprise the Chief Executive Officer, Deputy Chief Executive Officer and other key operational and functional managers from Sopra Steria Group and its subsidiaries.

The Chief Executive Officer has the broadest possible powers to act in all circumstances in the name of Sopra Steria Group SA, the parent company of Sopra Steria Group. He/she represents the Company in its dealings with third parties.

Certain decisions relating to strategy implementation and internal organisation require prior approval by the Board of Directors or its Chairman. Decisions “that are highly strategic in nature or that are likely to have a significant impact on the financial position or commitments of the Company or any of its subsidiaries” are defined in the internal rules and regulations of the Board of Directors (see Chapter 8, “Additional information” of this Universal Registration Document, pages 330 to 336).

Éric Hayat Conseil is a company controlled by Éric Hayat, a Director of Sopra Steria Group.

This agreement relates to the provision to Executive Management of consulting and assistance services. These services are provided in connection with strategic deals connected with business development among other areas. They are charged at a per diem rate of €2,500 (excluding taxes). The duties performed under this agreement are distinct from those performed by virtue of Éric Hayat’s directorship. For example, this may involve but is not limited to the following, in consultation with the Group’s operational managers:

• ■taking part in top-level market meetings;
• ■maintaining contacts with civil society;
• ■taking part in high-level meetings with certain key clients in France and abroad;
• ■preparing for and participating in delegations of corporate executives to priority countries for the Group.

This enables the Company to benefit from the experience and knowledge of the Group gained by Éric Hayat throughout his career. This knowledge extends to its environment and some of its major clients. Éric Hayat was a co-founder of Steria. He also previously chaired the digital sector employers’ organisation and subsequently the broader “Fédération Syntec”, and is a former member of MEDEF’s Executive Committee. His skills and experience are thus particularly well suited to the responsibilities entrusted to him, which mainly relate to major business opportunities.

This means that the number of Directors on the Board that are directly involved in addressing the Group’s priorities in terms of strategic and commercial positioning is increased, thus enriching the Board’s debates. Éric Hayat, in his capacity as a member of the Compensation Committee and the Nomination, Governance, Ethics and Corporate Responsibility Committee, provides these committees with the benefit of the knowledge of the Group’s operational managers accumulated and maintained in the course of these assignments. Lastly, he has access to information channels within the Company that are helpful for feeding information back to the Board of Directors and its Committees.

Sopra Steria Group recorded expenses under this agreement in 2023.

• ■expenses: €175 thousand.

The Board of Directors reviewed the implementation of this agreement at its meeting on 25 January 2023. It unanimously agreed to maintain the previously granted authorisation for the current financial year. The Director affected by this decision - Éric Hayat - did not take part in either the discussion or the vote, and all other directors were present.

On the date at which this Universal Registration Document was published, the Board of Directors had 18 members with the right to vote. The General Meeting directly nominated 15 Directors and 3 Directors represent the employees and employee shareholders.

The renewal of five current terms of office will be proposed at the General Meeting to be held on 21 May 2024 (see the summary of resolutions, Chapter 9 “General Meeting” of this Universal Registration Document (page 344). The Directors concerned are:

• ■Marie‑Hélène Rigal‑Drogerys;
• ■Pierre Pasquier;
• ■Éric Pasquier;
• ■Éric Hayat;
• ■and Sopra GMT, represented by Kathleen Clark.

Collectively, the members of the Board of Directors and the Chief Executive Officer hold around 20% of the Company’s share capital and 30% of its voting rights.

The Nomination, Governance, Ethics and Corporate Responsibility Committee plays a central role throughout the four phases of the selection process for Independent Directors. The same process applies to Directors who are not independent as defined by the AFEP-MEDEF Code from Phase 3 as set out below.

Phase 1. This is the needs analysis phase. The Committee identifies the end dates of Directors’ terms of office and explores the possibility of renewing them. It takes into account the objectives of the diversity policy and the skills required. It accommodates imperatives arising from compliance with the law and with the Code of Corporate Governance. This analysis is undertaken for the Board of Directors itself and its committees. It focuses on the needs due to arise first and makes projections for the years ahead.

Phase 2. A list of potential candidates is drawn up based on the needs identified. This list is made up of the following:

• ■names put forward:
  • ●by members of the Nomination, Governance, Ethics and Corporate Responsibility Committee,
  • ●and by members of the Board of Directors more generally;
• ■names put forward by recruitment firms;
• ■names proposed by Executive Management;
• ■unsolicited applications received by the Company.

The Chairwoman of the Nomination, Governance, Ethics and Corporate Responsibility Committee decides on the list of potential candidates. A file is put together based on publicly available information about the candidates.

After reviewing this file, the Nomination, Governance, Ethics and Corporate Responsibility Committee decides which candidates to contact and meet.

Phase 3. Members of the Nomination, Governance, Ethics and Corporate Responsibility Committee arrange meetings with the selected candidates. At their meetings, the Committee’s members compare their opinions. For each candidate, the Committee endeavours to assess the depth of their experience and how closely it fits the Company’s needs. What they would bring to the Board from a diversity perspective and their motivation are also considered. Lastly, the Committee checks their availability, whether they have any conflicts of interest, and whether they meet the independence criteria in the Code of Corporate Governance. Additional actions are agreed upon as necessary to complete the list of candidates.

Phase 4. The Board of Directors:

• ■is made aware of the findings of the previous phases;
• ■discusses the candidates put forward by the Nomination, Governance, Ethics and Corporate Responsibility Committee;
• ■decides which candidates will be put to the vote at a General Meeting of Shareholders.

In the specific case of Directors representing the employees and the Director representing employee shareholders, the Company decided to launch an extensive call for applications across the Group.

The Sopra Steria Group Works Council designates the Directors representing the employees.

The General Meeting of Shareholders elects the Director representing employee shareholders from among the candidates put forward by employee shareholders. After reviewing the candidates, the Nomination, Governance, Ethics and Corporate Responsibility Committee may recommend that the Board of Directors support an appointment resolution to be put to the shareholders at a General Meeting. The candidate elected is the one whose appointment resolution gains the required majority and the most votes, in the event of multiple candidacies.

The goal of the Board of Directors’ diversity policy is to bring together the perspective, skills and experience required for effective collective decision-making. It aims to meet the needs and reflect the characteristics of the Group while assembling a reasonably sized team. Each of its members must show good judgement and foresight, and uphold the standards of ethical conduct expected of a Director.

The impact on diversity and the integration of future Directors is considered every time a proposal is made to appoint Directors. The Nomination, Governance, Ethics and Corporate Responsibility Committee plays a key role in this regard.

Diversity is often assessed using measurable indicators related to gender equality, age and nationality.

With regard to gender equality, the Company aims to continue moving toward gender equality to the greatest extent possible. Each gender should account for at least 40% of the Directors. It is actively seeking to achieve gender equality in its Board committees.

Women currently account for six of the fifteen appointments made at the General Meeting (40%). Two of the three committees are chaired by a female Director. The four female Independent Directors are members of at least one committee.

The targets for increasing the proportion of women in senior management positions, set with reference to the AFEP-MEDEF Code, are presented in Section 2.7.1, “Promoting gender equality” of Chapter 4, “Corporate responsibility” of this Universal Registration Document (pages 129 to 131). They were reviewed and discussed at several meetings of the Nomination, Governance, Ethics and Corporate Responsibility Committee and adopted by the Board of Directors. They take into account the Group’s proactive approach to corporate social responsibility, its management needs, and the proportion of women in its business sector and at the Company. On Executive Management’s recommendation, the Board of Directors has approved targets, an action plan and practical arrangements that will make a real difference. They focus on delivering far-reaching action over the long term. The proportion of women in senior management positions forms part of those quantifiable targets on which the Chief Executive Officer’s variable compensation is based.

Age is not a criterion that is considered. The Company has not set a minimum or maximum age requirement for directorships. However, the Articles of Association (Art. 14) limit the proportion of Directors aged over 75 to one third. The average age of the members of the Board of Directors is 62 (at 31/12/2023). Three out of 18 Directors are over 75 years old.

Given the international dimension of the Group’s business, it is considered desirable to have foreign nationals sitting on the Board of Directors. As far as possible, Directors who are foreign nationals come from or live in countries in which the Group operates or is seeking to develop business. To attract Directors living outside France, the internal rules and regulations of the Board of Directors permit Directors to take part in meetings using videoconferencing or conference call systems, and the Company can make payments to cover their travel costs. Furthermore, an adjustment to the method used to apportion compensation among Board members has been agreed to better reflect the constraints on foreign Directors. This consists of adding an additional 20% weighting to attendance at meetings of the Board and its committees for Directors living outside France. This does not apply to Directors who carry out their work within the Group. Five out of 18 Directors have at least one other than French nationality.

It is also a priority for the Board of Directors to have a diverse range of skills. The Company has identified ten key competencies that it would like to be represented within the Board of Directors. These skills and areas of experience are as follows:

• ■knowledge of consulting, digital services, software development and the ability to promote innovation: This expertise will have been gained at a digital services company, software vendor or consulting firm, or in an industry sector focused on innovation in B2B services;
• ■knowledge of one of the Group’s key vertical markets: Ideally, this expertise will have been gained working for a client of the Group or one of its competitors. It may also be acquired through long sales experience in this market. It should be accompanied by knowledge of the services sector;
• ■entrepreneurial experience: Entrepreneurial experience will have been gained by starting up or taking over an industrial or commercial business and through contact with the various stakeholders (clients, employees, lending shareholders, suppliers, authorities);
• ■CEO of a major group: This presupposes past or current experience as a non-salaried executive company officer (Chairman, CEO or Deputy CEO) of a company established in more than one country or that employed more than 25,000 people;
• ■finance, control and risk management: This expertise requires professional experience gained in finance, audit or internal control or while holding a corporate office;
• ■CSR – Human resources and labour relations: This expertise requires professional experience gained in human resources, either in a company or as an external consultant, in institutions, industry bodies, trade unions or public benefit organisations or while holding a corporate office.
• ■CSR – Environmental and social issues: This expertise presupposes familiarity with institutions, industry bodies, trade unions or public benefit organisations, or expertise in handling climate-related, environmental and social issues from a business perspective;
• ■international dimension: This indicates skills in cross-cultural management combined with being versed in more than one culture, working as an expatriate or holding corporate office in an international group;
• ■Knowledge of Axway Software: Knowledge of Axway Software will have been gained through professional experience or corporate office at Axway Software or experience as a client or partner of Axway Software;
• ■Operational experience within the Sopra Steria Group: This experience presupposes longstanding current or past service within the Sopra Steria Group, as an employee or equivalent, and in-depth knowledge of the Group, its working practices and its management. A corporate office of at least four years in a company recently acquired by the Group may also be taken into consideration.

Each of these 10 key areas of expertise and experience are currently represented on the Board of Directors by several Directors (see table below):

In addition to these ten key areas of expertise and experience, and given Sopra Steria Group’s ownership structure, the Nomination, Governance, Ethics and Corporate Responsibility Committee also considers experience of corporate governance within family-owned listed companies to be of benefit to potential Board members. Such experience promotes the use of key strengths and harnesses an understanding of the challenges faced by family-owned companies in pursuit of sustainable and profitable growth. It is primarily gained through serving as a corporate officer or senior manager in a company – either listed or with a broad shareholder base – whose main shareholder is either an individual or a family. This main shareholder holds at least 10% of the voting rights and either runs the company or has the ability to choose who runs it.

• ■Two Directors representing the employees were designated on 23 September 2020 by the Sopra Steria Group Works Council. They are namely Hélène Badosa, a member of the Compensation Committee, and David Elmalem.
• ■A Director representing employee shareholders, Astrid Anciaux, was elected at the General Meeting of Shareholders held on 26 May 2021.

The Nomination, Governance, Ethics and Corporate Responsibility Committee also monitors the proportion of Independent Directors on the Board.

Ten Directors are considered independent by the Board of Directors. They account for around 67% of Directors appointed by the shareholders at a General Meeting.

A procedure has been laid down for selecting Independent Directors (see Section 1.2.2 of this chapter, page 60).

Every year, the Nomination, Governance, Ethics and Corporate Responsibility Committee and then the Board of Directors review the status of each member of the Board of Directors with respect to the requirements for Independent Directors set out in Article 10 of the AFEP-MEDEF Code of Corporate Governance for Listed Companies:

Like Sopra Steria Group, Axway Software is fully consolidated by Sopra GMT. According to the Nomination, Governance, Ethics and Corporate Responsibility Committee, a current term of office on Axway Software’s Board of Directors does not call into question the status of Independent Director:

• ■Sopra Steria Group’s Board of Directors is regularly informed of Axway Software’s operational and financial position. However, it does not discuss Axway’s routine operations and investments;
• ■the procedure for handling potential conflicts of interest applies to the consideration of any matters related to Axway Software;
• ■the Independent Directors present on both Sopra Steria Group’s and Axway Software’s Boards of Directors ensure that opinions independent of the core shareholder are heard on issues concerning both companies and their strategy.

The Directors in question are Marie-Hélène Rigal-Drogerys, Michael Gollner and Yves de Talhouët. Sopra Steria Group’s Board of Directors came to similar conclusions as the Nomination, Governance, Ethics and Corporate Responsibility Committee.

Members of the Board of Directors may hold an office or have an interest in companies that have potential business relationships with the Sopra Steria Group or its core shareholder. The Board of Directors shall assess whether the nature, purpose and significance of this affiliation may affect their standing as Independent Directors. It will draw, in particular, on the prior work done by the Nomination, Governance, Ethics and Corporate Responsibility Committee.

In the case of a business relationship, its significance is inferred by reference to various criteria, including in particular the following:

• ■whether the service provided is of a strategic nature;
• ■whether there is reciprocal dependence;
• ■the volume of business transacted (particularly where this equates to more than 1% of annual revenue);
• ■the selection procedure used and how often the business is put out to tender;
• ■whether the Director is involved in the business relationship.

A real estate investment trust held by André Einaudi owns the premises occupied by the Company for a number of years at its Aix-en-Provence site. The Board of Directors considers that these circumstances do not constitute a material business relationship. In reaching this conclusion, the Board took into account the age, term and amount of the lease, signed prior to André Einaudi’s appointment as a Director. It also noted that it is customary for the Group to rent its premises: apart from in exceptional circumstances, the Group does not own its premises. Lastly, the Board confirmed that no dependency is created for the lessor in relation to this lease.

The Company identified no other business relationships with Independent Directors.

The roles of Chairman of the Board of Directors and Chief Executive Officer have been separated. The Chairman of the Board of Directors is not regarded as independent under the AFEP-MEDEF Code. A change to the Board of Directors’ internal rules and regulations was proposed in July 2022 to appoint a Senior Independent Director responsible for handling conflicts of interest. The independent members of the Nomination, Governance, Ethics and Corporate Responsibility Committee unanimously voted against the Company’s proposal. They adopted this position on the grounds that conflicts of interest rarely arise within the Board of Directors. They also found that there have been no difficulties in managing any such conflicts. That said, the Committee has reserved the option of reviewing this proposal again in the future, in particular if the situation changes. The Board of Directors has endorsed its recommendation.

The the Nomination, Governance, Ethics and Corporate Responsibility Committee and the Board of Directors will re-examine the possibility of appointing a Senior Independant Director with broader competencies with a view to preparing the transition of the Board of Director's Chairmanship.

The Chairman of the Board of Directors is responsible for the Board’s shareholder relations.