Subsection 4: Specialist committees

I.-Investment firms of significant size, the board of directors, the supervisory board or any other body exercising equivalent supervisory functions shall set up a compensation committee.

Branches of third-country undertakings referred to in Article L. 532-48 that are large in relation to their size are required to provide evidence of the existence of a compensation committee or a system for achieving the same objectives that is competent for these branches. This committee or any other mechanism designed to achieve the same objectives must comply with the provisions relating to the remuneration committee in this article.

II-The remuneration committee prepares the decisions which the board of directors, the supervisory board or any other body exercising equivalent supervisory functions takes concerning remuneration, in particular those which have an impact on risk and risk management in the investment firm.

III - The remuneration committee shall be composed of members of the board of directors, the supervisory board or any other body exercising equivalent supervisory functions who do not exercise management functions within the investment firm. Its composition ensures a balanced representation of men and women. The committee exercises independent judgement on remuneration policies and practices and on the incentives created for risk, capital and liquidity management.

The members of the Remuneration Committee shall have knowledge and skills appropriate to the performance of the Committee's duties.

In the case of investment firms which are required, pursuant to the provisions of the Commercial Code, to have employee representatives on the board of directors, the supervisory board or any other body exercising equivalent supervisory functions, the remuneration committee shall include at least one such representative.

IV -Where the investment firms referred to in I above are part of a group subject to the supervision of the Autorité de contrôle prudentiel et de résolution on a consolidated basis, the board of directors, the supervisory board or any other body exercising equivalent supervisory functions may decide that the functions of the remuneration committee shall be exercised by the committee of the undertaking at the level of which supervision is exercised on a consolidated basis.

V.-When preparing the decisions referred to in II, the remuneration committee shall take into account the public interest and the long-term interests of the shareholders, investors and other stakeholders of the investment firm.

VI - The criteria for materiality according to which investment firms and branches of investment firms are required to comply with the obligations of this article, as well as the procedures for informing the remuneration committee, are specified by order of the Minister responsible for the economy.