page 225 5.1. Charter and bylaws 226 5.2. Description of SCOR’s share capital 232 5.3. Third-party information and statements by experts and declarations of any interest 234 5.4. Published information 234 5.5. Material contracts 234
The Solvency II framework covers, among other matters, valuation of assets and liabilities, the treatment of insurance and reinsurance groups, the definition of capital and the overall level of required capital. A key aspect of Solvency II is that assessment of the Group’s risks and capital requirements is aligned more closely with economic capital methodologies.
SCOR Global P&C, the Group’s Non-Life division, operates worldwide through the branches of two main global reinsurance companies (SCOR Global P&C SE and SCOR SE) and the branches of a global insurance company (SCOR UK Limited) as well as insurance and reinsurance subsidiaries in Spain, Italy, Switzerland, the UK, Germany, South Africa, Russia, the Americas and AsiaPacific, including China, India, South Korea, Hong Kong and Singapore.
On July 21, 2015, Fitch Ratings upgraded SCOR’s insurer financial strength rating from “A+ positive outlook” to “AA- stable outlook”
Long-Term Care (LTC) insurance covers the inability of the insured to perform predefined activities of daily living, resulting in the insured needing constant assistance from another person.
SCOR owns offices in Paris (France), Cologne (Germany), London (UK), Singapore and Madrid (Spain), where its local subsidiaries and branches have their corporate offices. Any surplus space is leased to third parties as part of SCOR’s investment management business. The Group leases office space for its other business locations. It leases space separate from its head office for the purpose of safeguarding its data storage facilities for business continuity planning purposes. The Group believes that the Group’s offices in each country in which it operates are adequate for its current needs.
●● R&D Center for Policyholder Behavior: providing support mainly in modeling and pricing lapse behavior within protection products.
The SCOR technical environment is based on a secured international network, a cloud-based global data center with a fully replicated dual site, and a standard workstation deployed everywhere in the world. SCOR has also implemented an ambitious security plan based on stronger physical and logical access controls, cyber security reinforcement, large program for data protection, and recovery in the event of any type of disaster.
Non-Life reinsurance is a cyclical market. The cyclical trends observed in prior years largely continued in 2016, though the market’s pricing declines moderated. Pricing in Non-Life reinsurance has declined because supply has increased faster than demand. Supply has risen due to a number of factors including increasing traditional capacity, new forms of capacity, actual losses being lower than expected losses, and retained earnings. Demand has risen less quickly due to factors including consolidation of reinsurance spend, increased retention, and new products taking time to develop. Macroeconomic uncertainty continued in 2016 with interest rates low but volatile and the global political situation changing materially. The insurance industry’s “protection gap” remains a long-term opportunity that market participants have continued to address with some success in 2016.
– maintaining its policy of being positioned on strong-growth markets such as Asia-Pacific and Latin America,
(1) In 2015, SCOR Global Life’s individual treaties have been reallocated based on a review of product line definitions. The gross written premiums in Protection and Financial Solutions previously reported in the 2014 Registration Document were EUR 5,088 million and EUR 1,047 million respectively for the year ended December 31, 2014.
Net investment income (1) for the year ended December 31, 2016 amounted to EUR 670 million as compared to EUR 666 million and EUR 576 million for the years ended December 31, 2015 and 2014, respectively. The net return on investments in 2016 was 2.5% compared to 2.6% in 2015 and 2.5% in 2014. The increase in investment income from 2015 to 2016 is mainly due to the active portfolio management strategy implemented by SCOR Global Investments, which translated into substantial realized capital gains of EUR 207 million, mostly achieved on the real estate and fixed income portfolios and to a lesser extent on the other investments portfolio. The return on invested assets in 2016 was 2.9% as compared to 3.1% in 2015 and 2.9% in 2014 (2).
In the EMEA region, SCOR Global Life reinforced its franchises in key European markets such as France, the UK, and Nordic countries. SCOR Global Life is also expanding into the large South African market.
SCOR Global Life has established itself as a recognized provider for longevity reinsurance, focusing on longevity risk transfer transactions for large in-payment pension portfolios, creating a new business pipeline with growth opportunities. The Longevity product line accounts for 8.4% of SCOR Global Life’s gross written premiums in 2016 and is one of the main drivers of premium growth (23.3% increase in gross written premiums in 2016). The main active market to date for SCOR Global Life is UK with a portfolio from recent years and new business signed in 2016 while exploring business opportunities in other markets such as Canada, where SCOR Global Life entered into a longevity transaction in 2015.
(3) Realized gains/losses on invested assets are shown net of realized losses on derivatives of EUR 4 million. These are included in realized capital gains/losses on investments for IFRS presentation purposes.
The Group has been granted credit facilities from several companies of the banking sector to guarantee the reinsurance activities of various subsidiaries for a global issued amount of USD 3.3 billion as at December 31, 2016. These credit facilities are stand-by letters of credit that the banking counterparty agrees to issue in the form acceptable to the American National Association of Insurance Commissioners (NAIC) or other appropriate regulatory body.
●● Chairman of the Board of Directors of GMF Assurances (France)
●● Permanent representative of Azur-GMF Mutuelles Assurances Associées on the Board of Directors of Assistance Protection Juridique (France)
●● Member of the Supervisory Board of OFI Asset Management (France)
pOSITIONS THAT ExpIRED DuRING THE LAST FIVE YEARS ●● Vice-Chairman and member of the Supervisory Board of Macifimo ADB, formerly GPIM (France)
Date of first appointment: April 15, 2009 Expiration of term: 2017
Member of the Strategy Committee, Risk Committee and Crisis Management Committee
pOSITIONS THAT ExpIRED DuRING THE LAST FIVE YEARS ●● Director of Institut Pasteur (France)
Member of the Strategy Committee, Audit Committee, Risk Committee and Compensation and Nomination Committee
5. Must not have a close family relationship with one of the Company’s corporate officers.
(7) From 2014 to 2016, the Lloyd’s Channel Syndicate (122 employees at December 31, 2016) is a subsidiary of SCOR Global P&C SE, managed independently from the Group in terms of human resources and not aggregated financially (and then socially) in the division.
●● a target variable annual compensation of EUR 1,200,000, 50% of which is based on financial objectives while the remaining 50% is based on personal objectives, each of these personal objectives being equally weighted. These objectives are defined at the beginning of each year by the Board of Directors on the recommendation of the Compensation and Nomination Committee.
Finally, in compliance with the recommendations of the AFEPMEDEF corporate governance code applicable to the executive corporate officer, he also made a formal commitment not to resort to the use of hedging instruments on the stock options and/or performance shares which have been granted to him for the whole duration of his term of office.
Moreover, the Chairman and Chief Executive Officer receives additional benefits, such as a life insurance, a health insurance policy, a specific life insurance policy, to complement the “all causes” death or permanent disability insurance subscribed for senior executives of the Company and a death or permanent disability insurance in case of an accident.
Solvability Solvency ratio equal or higher than the lower limit of the optimal range defined in the strategic plans (185%)
SCOR’s solvency ratio, as defined by the internal model, stands at 225% at the end of 2016
The amount of premium underwritten by Channel in 2016 year exceeds the amount forecasted in the strategic plan
In accordance with the authorization by the Shareholders’ Meeting on April 30, 2015 in its twenty-fourth resolution, the Company’s Board of Directors’ meeting of February 23, 2016, on the proposal of the Compensation and Nomination Committee meetings of February 9, 2016 and February 22, 2016, decided to allocate on March 10, 2016, stock options to the Chairman and Chief Executive Officer and to the other members of the Executive Committee. On this plan, 25,000 stock options have been granted to the Chairman and Chief Executive Officer. These options are subject to the following performance conditions: Half of the options will be acquired after the expiration of an acquisition period set at 4 years, i.e. on March 11, 2020, provided: (1) that the conditions set out in the Plan of March 10, 2016 are fulfilled and in particular that the quality of Chairman and Chief Executive Officer of the SCOR Group remains until March 10, 2020 inclusive, except as otherwise provided by the Plan; (2) that the Group’s ethical principles as described in its Code of Conduct are respected; therefore, in case of actual misconduct as per the Code of Conduct for instance in the event of fraud, the beneficiary will lose all of his/her stock options benefits (clawback policy) ; (3) that the average SCOR ROE over 2 years (from January 1, 2016 to December 31, 2017) is equal to the average of SCOR ROE strategic target (the “Target ROE”) over the period.
In accordance with the authorization by the Shareholders’ Meeting on December 18, 2015 in its first resolution, the Company’s Board of Directors’ meeting of February 23, 2016, on the proposal of the Compensation and Nomination Committee meetings of February 9, 2016 and February 22, 2016, decided to grant performance shares to the Chairman and Chief Executive Officer and to the other members of the Executive Committee. On this plan, The Chairman and Chief Executive Officer has been granted 125,000 performance shares. Moreover, an exceptional grant of 75,000 performance shares under the “LTIP” Plan has been decided as a substitute for the 75,000 stock options attributed during the previous exercises. The purpose of this exceptional grant is to create a long-term incentive for the Chairman and Chief Executive Officer, in link with the implementation of the new strategic plan and with the proposal of the Compensation and Nomination Committee and the Board of Directors to extend his term of office for a further period of four years.
** Compensation, indemnities or benefits due or awarded in respect of the financial year which are or have been submitted to the Company’s Shareholders’ Meeting in accordance to the rules applicable to related party agreements and commitments.
The Board of Directors, upon the recommendation of the Compensation and Nomination Committee will assess whether or not the performance conditions have been met.
Stock subscription and purchase options granted to the executive corporate officer by the issuer or by another company of the Group
No pension contribution (or commitment) has been paid to the directors.
Mr. Thierry Derez Acquisition of shares for a total amount of EUR 10,000
2.2.2.2. COMpENSATION OF THE ExECuTIVE COMMITTEE MEMBERS (OTHER THAN THE CHAIRMAN AND CHIEF ExECuTIVE OFFICER) FOR THE FINANCIAL YEAR ENDED DECEMBER 31, 2016
The exercise of stock options allocated since 2008 is subject, if necessary, to the satisfaction of performance conditions. Thus, a third of the number of options awarded under the May 22, 2008 plan, half of the options awarded under the March 23, 2009 plan and all the options awarded since the March 18, 2010 plan are subject to the satisfaction of performance conditions. However all the options allocated since the March 23, 2009 plan to the Chairman and Chief Executive Officer are subject to the satisfaction of performance conditions. Please see Section 2.2.3.4 of this Registration Document and respectively Section 2.2.3.4 and Section 17.3 of the 2015 and 2014 Registration Documents filed with the AMF on March 4, 2016 and March 20, 2015 under numbers D.16-0108 and D.15-0181 for the details of the performance conditions applicable to the stock options.
Moreover, the exercise of stock options by the executive corporate officer and Executive Committee members is subject to clearance to deal in securities of SCOR SE by the General Secretariat.
(3) 19,198,044 shares underlying the warrants issued on December 16, 2016 to BNP Paribas under the contingent capital facility with an exercise period starting on January 1st, 2017 and expiring on May 1st, 2020.
The Chairman and Chief Executive Officer, under the authority given by the Board of Directors’ meeting held on February 23, 2016 for the implementation of this plan, allocated on March 10, 2016, 264,118 stock options to 59 Partners (Executive and Senior Global Partners).
The Chairman and Chief Executive Officer, under the authority given by the Board of Directors’ meeting held on October 26, 2016, for the implementation of this plan, allocated 750 stock options to 1 Partner (Senior Global Partner) on December 1, 2016.
The Extraordinary Shareholders’ Meeting also decided that (i) the total number of free shares granted under this authorization may not exceed 3,000,000 shares, (ii) the allocation of shares to their beneficiaries will be definitive only after a vesting period of a minimum set at three years, (iii) the beneficiaries will no longer be subject to an obligation to hold the shares, and (iv) the Company’s Board of Directors will have the authority to increase the length of the vesting period.
The final vesting of half of the shares granted is subject to the fulfilment of the following conditions: (1) that the conditions set out in the “LTIP” Plan of February 23, 2016 are fulfilled and in particular that the beneficiary remains employee or Corporate Officer of the SCOR Group until February 23, 2022 inclusive, except as otherwise provided by the Plan; (2) that the beneficiary respects the Group’s ethical principles as described in its Code of Conduct; (3) that the average SCOR ROE over six years (from January 1, 2016 to December 31, 2021) is equal to the average SCOR ROE strategic target (the “Target ROE”) over the same period.
The final vesting of the remaining half of the shares is subject to the fulfilment of the following conditions: (1) that the conditions set out in the “LTIP” Plan of February 23, 2016 are fulfilled and in particular that the beneficiary remains employee or Corporate Officer of the SCOR Group until February 23, 2022 inclusive, except as otherwise provided by the Plan; (2) that the beneficiary respects the Group’s ethical principles as described in its Code of Conduct; (3) that the average solvency ratio over six years (from January 1, 2016 to December 31, 2021) is at least equal to the average SCOR solvency strategic target over the same period (the “Target Solvency Ratio” (1)).
The conditions of the plan provide for a vesting period of three years for all beneficiaries. There is no longer an obligation to hold shares for a period of two years after the vesting period for tax residents in France.
The table below presents the total number of shares allocated in 2015 and 2016 by category within the Group, all types of plans included: Total number of LTIP shares allocated in 2016
Since the implementation of free share plans in 2004, 21,133,418 shares have been allocated, all types of plans included.
2.3.1.4. AGREEMENT WHICH COuLD RESuLT IN A SuBSEQuENT CHANGE IN CONTROL
Number of shares authorized under convertible securities and stock option plans
The Group’s liabilities are exposed to a significant increase in the rate of inflation (prices and salaries) which would require an increase in the value of reserves, in particular in respect of P&C long-tail business, e.g. general liability (medical among others) and motor bodily injury claims. In addition, SCOR is exposed to claims inflation over and above general inflation and in particular to the inflation of court awards in respect of general liability and bodily injury claims.
As such, SCOR may be forced to delay raising capital, issue shorter term securities than it prefers, or bear an unattractive cost of capital which could decrease its profitability and significantly reduce its financial flexibility.
In particular, SCOR is exposed to single or multiple terrorist attacks through some P&C treaties and national terrorism pools. Terrorism exposures are monitored on a worldwide basis as a fully integrated part of the Underwriting Management Framework. Underwriting guidelines stipulate the rules and procedures for terrorism risk for Treaty P&C, Specialty lines and SCOR Business Solutions (SBS). SCOR monitors this risk using a very conservative approach.
SCOR is also exposed to man-made casualty catastrophes whose underlying nature and key specificities can vary widely, from commonly used products (with Asbestos as a typical example), massive product liability losses emanating from items produced by a single manufacturer, to a single disastrous event (e.g. Deepwater Horizon oil rig explosion).
The Life division is organized in order to be able to assess and control its risks at each level of its business.
The Group’s equity selection is predominantly based on a bottom-up fundamental analysis with the goal to develop a diversified portfolio of stocks and convertible bonds directly or through mutual funds. Due to the inherent volatility of equities, this asset class (direct positions and mutual funds) is monitored on a daily basis, facilitating quick arbitrage or portfolio re-allocation decisions. On a Group level, the equity exposure is set and reviewed at least quarterly by the Group Investment Committee. The equity risk is also monitored by establishing maximum exposures per stock or mutual fund and is reviewed regularly (e.g. exposure to large-cap stocks will generally be greater than exposure to mid-cap stocks). The holding’s ratios on mutual funds are also reviewed regularly, based on the mutual fund’s portfolio.
The market sensitivities of the Group are estimated as follows: In EUR million
3.5.1.4. CREDIT RISK RELATED TO FuTuRE CASH FLOWS FROM LIFE REINSuRANCE TREATIES
3.5.2.2. MANAGEMENT OF CREDIT RISK RELATED TO SHARES OF RETROCEDED LIABILITIES
The retrocessionaires’ share in the reserves broken down by retrocessionaires’ financial rating is included in Section 4.6, Note 15 – Net contract liabilities.
The following table provides an overall analysis of the aging of financial assets and receivables as at December 31, 2016: In EUR million Current months > 36 months Total
* Interest on perpetual debt as at December 31, 2016 of EUR 40 million, on a yearly basis (2015: EUR 84 million). ** Of the amounts above, EUR 84 (1) million (2015: EUR 98 (1) million) relate to variable rate debt.
(9) Cash received in respect of margin calls linked to cross-currency swaps for EUR 134 million following significant fluctuations in the EUR/CHF exchange rate since the beginning of the year.
Net income for the year ended December 31, 2014 - - - - - 512 - (3) 509
Revaluation – Assets available for sale - - 236 - - - - - 236
SCOR Global Investments is the asset management division of the Group. Its role is complementary to the two reportable operating segments as it manages SCOR Global P&C’s and SCOR Global Life’s investment assets associated with their contract liabilities. SCOR Global Investments also manages third-party assets, however these activities are currently considered not material. Therefore SCOR Global Investments is not considered a separate reportable operating segment for the purposes of IFRS 8 – Operating segments.
NOTE 4.1. GROSS WRITTEN pREMIuMS AND INSuRANCE CONTRACT LIABILITIES BY GEOGRApHIC REGION
CONSOLIDATED FINANCIAL STATEMENTS Notes to the consolidated financial statements < #4
For debt securities, and loans and receivables, an objective indicator of impairment relates primarily to proven default credit risk. Different factors are considered to identify those debt securities potentially at risk of impairment, including significant financial difficulty or default in payments, to enable the Group to conclude whether there is objective evidence that the instrument or group of instruments is impaired.
There were no material transfers between level 1 and level 2 in 2016 and 2015, respectively. There were also no changes in the purpose of a financial asset that subsequently resulted in a different classification of that asset.
Amounts recorded in the statement of income include transaction costs that are expensed at inception as other operating expenses. The changes in fair value through income as presented above are recognized as other operating expenses or other operating income.
On August 2, 2016, SCOR repaid the CHF 650 million perpetual debt issued in 2011 and the related cross-currency swap matured.
Intangible assets with finite useful lives are amortized over the expected useful economic life and tested for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period and the amortization method for intangible assets with finite useful lives are reviewed annually. Changes in the expected useful life or the expected pattern of future economic benefits are accounted for prospectively by changing the amortization period or method as appropriate and are treated as changes in accounting estimates. The amortization expense on intangible assets with finite lives is recognized in the statement of income in the expense category consistent with the intangible asset.
The authorized share capital of the Company at December 31, 2016 was 192,534,569 shares with a par value of EUR 7.8769723 each compared with authorized share capital of 192,653,095 shares with a par value of EUR 7.8769723 at the end of 2015 and with authorized share capital of 192,691,479 shares with a par value of EUR 7.8769723 at the end of 2014.
The post-employment benefits granted by the Group vary based on legal obligations and local requirements. Group employees are entitled to short-term benefits, recognized as an expense for the period by the different entities of the Group (paid leave, sick leave and profit sharing), and long-term benefits and post-employment benefits classified as defined benefit or defined contribution plans (pension).
Gross claims reserves & estimates – end of year (2) 5,791 9,325 9,127 9,156 9,696 10,602 10,857 10,691 11,088 11,750 11,784
Ceded DAC – end of year - 2 1 - 1 5 7 8 10 14 13
(2) At period end exchange rates. (3) At average exchange rates. (4) Includes net cumulative payments for all underwriting years as at each reporting date.
The change in Life mathematical reserves for the years ended December 31, 2016 and 2015 was as follows: In EUR million 2016 2015
Income before corporate income tax (excluding share in results of associates) 766 873 680
Stock options and share-based compensation (2) - 3,253 - - 4,485 - - 2,496 -
Dividends are distributable to shareholders in proportion to their respective holdings of ordinary shares. Dividends are payable to holders of ordinary shares outstanding on the date of the Shareholders’ Meeting approving the distribution of dividends or, in the case of interim dividends, on the date of the meeting of the Board of Directors approving the distribution of interim dividends. The actual dividend payment date and the terms of payment are determined by the Shareholders’ Meeting approving the declaration of the dividends or by the Board of Directors in case of distribution of interim dividends. The payment of the dividends must occur within nine months of the end of the financial year. Dividends not claimed within five years of the date of payment revert to the French government. According to the bylaws, shareholders may decide in an Ordinary Shareholders’ Meeting to give each shareholder the option of receiving all or part of a dividend or interim dividend in the form of ordinary shares. The determination of the portion, if any, of the annual dividend that each shareholder will have the option to receive in ordinary shares is also made at the Ordinary Shareholders’ Meeting following a recommendation by the Board of Directors.
Voting by correspondence is also allowed under French company law. Forms for voting by mail or proxy must be addressed to the Company, either by regular mail or, pursuant to a decision of the Board of Directors, in electronic format. Mail voting forms must be sent to the Company within the period prior to the meeting as established by the Board of Directors. This period may not exceed three days before the meeting date. Proxy forms must be received by the Company no later than 3 p.m. (Paris time) on the day prior to the meeting.
The Company’s Registration Document filed with the AMF, as well as the press releases of the Company, its annual and half-year reports, its annual and consolidated financial statements as well as the information relating to the transactions upon treasury shares and to the total number of shares and voting rights can be found on the Company’s website at the following address: www.scor.com.
APPENDIX F – ADDITIONAL INFORMATION RELATING TO THE MANAGEMENT REPORT OF THE COMPANY AND THE GROUP – CORRESPONDENCE TABLE 306 1 Operating and financial review of SCOR SE 306 2 Trends in the SCOR SE share price 3 Social impact of SCOR’S activity 308 4 Environmental impact of SCOR’S activity 308 5 Information related to societal commitments in support of sustainable development 308 6 Related party agreements 308 7 Additional information provided in the management report of the Company and the Group – correspondence table 309
It has been incorporated in Appendix A of the 2016 Registration Document of SCOR SE which is available on the Company’s website (www.scor.com) and on the AMF web site (www. amf-france.org).
●● The Group tax function sets the Group tax policy with the purpose of ensuring that the various entities of SCOR meet their tax obligations and promote the use of best practices in this domain.
The processes described below concerning reinsurance accounting and the calculation of underwriting reserves, which are predominantly within the single technical information system (OMEGA), are applied by Group entities. A high level of control already exists in OMEGA. As part of the on-going OMEGA reengineering project, OMEGA 2.0, which was confirmed as a strategic project in July 2010 by the Board of the Group and by the Executive Committee, several improvements have already been or will be implemented to reinforce the level of control provided.
Subordinated loan granted to SCOR Reinsurance Asia-Pacific Pte Ltd for USD 40 million
The corporate financial statements for the year ended December 31, 2016 are presented in accordance with the accounting provisions grouped under Title IV of Book III of the Insurance Code and with the French standard-setter (Autorité des Normes Comptables – ANC) regulation n°2015-11 of November 26, 2015 approved by the Order of December 28, 2015, relative to the annual accounts of insurance undertakings, as amended by the ANC regulation n°2016-12 of December 12, 2016. In the absence of specific provisions in the aforementioned ANC Regulation 2015-11, the provisions of ANC Regulation n°2014-03 relating to the general accounting plan (Plan Comptable Général – PCG) are applicable.
In accordance with Statement 2015-11 dated November 26, 2015 of the French standard-setter (Autorité des Normes Comptables – ANC), the difference between cost and redeemable par value of depreciable assets in the scope of Article 121-2 and followings of Statement 2015-11 dated November 26, 2015 of the French standard-setter (Autorité des Normes Comptables – ANC) is amortized to income over the remaining period until maturity.
Bonds and other fixed-income securities are recorded at cost, excluding accrued interest. In compliance with Article 122 – 1 of Statement 2015-11 dated November 26, 2015 of the French standard-setter (Autorité des Normes Comptables – ANC), the difference between cost and redeemable par value is amortized to income over the remaining period until maturity using the effective interest rate method.
A liquidity risk reserve is recorded for the possible need to liquidate assets in order to make immediate payment on major claims. This reserve is included in underwriting reserves and is recorded when the total net book value of investments assets, excluding bonds and other fixed income securities (investments valued according to Article R. 343-9 of the French Insurance Code), exceeds their fair value. Fair value corresponds to the average price calculated over the last thirty days preceding the day of the inventory or, failing that, the market price for listed shares, net asset value for unlisted shares and net realizable value for investments in subsidiaries as described in Note 5.2.1.
●● retirement indemnities: employees benefit from additional retirement benefits paid in full upon retirement. The evaluation of these indemnities depends on several factors such as age, years of service and salary; ●● senior management pension obligations (Article 39): The valuation of the reserve for senior management pension obligations is based on the following actuarial assumptions: – discount rate: 1.38%, defined with respect to high quality long-term corporate bonds with maturities consistent with the duration of the obligations evaluated,
The costs associated with the acquisition of new Non-Life contracts, essentially commissions, are recorded as assets within the limits of contract profitability. They are amortized over the period of earned premiums. The acquisition costs of Life reinsurance operations are not usually deferred.
In the corporate income statement of SCOR SE under French GAAP, the Non-Life segment encompasses personal accident/sickness reinsurance in accordance with Article 330-1 and followings of Statement 2015-11 dated November 26, 2015 of the French standard-setter (Autorité des Normes Comptables – ANC). Personal accident/sickness reinsurance is classified in the Life segment in the consolidated financial statements under IFRS.
The use of and accounting for financial instruments comply with European Directive 2005/68/EC (also known as the Reinsurance Directive); with the French General Statement of Accounting Principles (Plan Comptable Général) of 1982; and with French Decree No. 2002-970 dated July 4, 2002, relating to the use of forward financial instruments by French insurance companies.
The EUR 400 million cash advance to SCOR Global P&C SE was increased by EUR 151 million and was partly reimbursed for EUR 250 million.
●● Loans granted to SCOR SE by its subsidiaries EUR 16 million (EUR 14 million as of December 31, 2015).
The maturity of investments, debt, other than financial liabilities, and receivables is less than one year.
●● The issuance of shares relating to the exercise of options until December 31, 2016 for a total of EUR 10.3 million was allocated to the share capital of the Company for EUR 4.3 million and to additional paid-in capital for EUR 6 million. The exercise of options resulted in the creation of 554,112 shares.
In 2013, SCOR entered into a cross-currency swap which converts CHF 250 million of the principal of the notes issued in 2013 into EUR and the CHF coupon on the notes to EUR 5.8975% and which matures on November 30, 2018.
In 2011, SCOR entered into cross-currency swaps which converted CHF 650 million into EUR and the coupon on the CHF 400 million placement to 6.98% and on the CHF 250 million placement to 6.925%. Both instruments matured on August 2, 2016.
As a global group organized into four Hubs located in the world’s main financial centers, SCOR offers competitive base salaries in order to position itself as a competitive player on the labor market and attract and retain talent.
Breakdown of employees by type of working time (and by gender)
●● The “SCOR International Gender Network” (SIGN) was launched on November 4 2016. It includes the proposition of a mentoring program and several workshops to promote gender diversity and women empowerment within the Group on a global scale.
(1) From 2016, the french disabled employees under the status “mi-temps thérapeutiques” are reported in the “declaration obligatoire d’emploi des travailleurs handicapés” (DOETH).
●● The items mentioned in the document pertain to the entire Group except ReMark, Telemed, Réhalto, MRM and the Lloyd’s Channel Syndicate. These three entities are wholly-owned by SCOR Global Life SE and are managed independently of the Group in terms of human resources. The Lloyd’s Channel Syndicate is a subsidiary of SCOR Global P&C SE and is managed independently from the Group in terms of human resources. MRM is a subsidiary of SCOR SE and is managed independently from the Group in terms of human resources.
In its projects of extension or relocalization, the Group integrates environmental considerations when it selects its offices, notably office buildings it intends to acquire. The Group favors so-called sustainable or ecoresponsible construction. SCOR is attentive to either energy efficiency, or environmental credentials, as far as design and construction, or renovation are concerned. These considerations may be subject to a tradeoff with other ones such as the localization of the office or its availability.
Most of these emissions were driven by business transportation representing around 82% of the Group’s emissions of which air transportation accounted for 98%. The emission rate retained includes the upstream phase (extraction, refining and transport of the fuel) and the combustion phase. With regard to transport, gases outside of the Kyoto protocol are also taken into account (mainly water vapor generated by jet engines). Stripping out gases not included in the Kyoto Protocol, the Group’s emissions fall to 14,382 tons of CO2 equivalent of which air transportation accounts for 71%.
Data was collected on a target scope including all Group sites with more than 30 employees for all of the reporting indicators. This target scope accounts for 85.5% of employees (as of December 31, 2016) of legal entities fully consolidated in the financial statements plus Channel Syndicate which is located in the Group’s London premises. Within this target scope, environmental data with respect to premises were not available for one location hosting 39 employees due to a move in the course of the year. However, information regarding business travel originating from this location were effectively reported.
●● “Scope 2”: indirect emissions induced by electricity consumption, steam and cooling systems. For most of the sites surveyed, most of these emissions are induced by electricity procurement and
Additional information on some of these sponsorship and scientific partnership programs is available in Section 1.2.6.2 – Research and development, patents and licenses of this document.
We conducted about ten interviews with the persons responsible for preparing the CSR Information in the departments in charge of collecting the information and, where appropriate, responsible for internal control and risk management procedures, in order to: ●● assess the suitability of the Guidelines in terms of their relevance, completeness, reliability, neutrality and understandability, and taking into account industry best practices where appropriate; ●● verify the implementation of data-collection, compilation, processing and control process to reach completeness and consistency of the CSR Information and obtain an understanding of the internal control and risk management procedures used to prepare the CSR Information.
We determined the nature and scope of our tests and controls based on the nature and importance of the CSR Information with respect to the characteristics of the Company, the human resources and environmental challenges of its activities, its sustainability strategy and industry best practices.
Risks related to human life including mortality, disability, critical illness, health, long-term care and longevity.
Reinsurance contract written to protect the ceding company from all or part of claims in excess of a specified amount retained (priority). This generally takes the form of excess of loss (or XL) or excess of annual loss reinsurance.
A regulation in the US, (NAIC Model Regulation XXX or Valuation of Life Insurance Policies Model Regulation) commonly referred to as Regulation XXX (or Triple X) which requires that US life insurance and life reinsurance companies must hold on their statutory financial statements a relatively high level of regulatory or statutory reserves for various types of life insurance business, primarily certain level term life products. The reserve levels required under Regulation XXX increase over time and are normally in excess of reserves required under IFRS.
●● the 2016 free share allocation plans, are presented in separate reports of the Board of Directors.
7 ADDITIONAL INFORMATION PROVIDED IN THE MANAGEMENT REPORT OF THE COMPANY AND THE GROUP – CORRESPONDENCE TABLE
Research and development activities within the Group and the Company Section 1.2.6
●● List of the other functions and offices held by the Board members in 2016 Section 2.1.2
Summary table of outstanding delegations regarding share capital increase Section 2.3.1.5
> Additional information provided in the management report of the Company and the Group – correspondence table
STATEMENT BY THE PERSON RESPONSIBLE FOR THE REGISTRATION DOCUMENT APPENDIX B 248
Review of the parent company’s and consolidated Group’s net income or loss, financial position, main risks and uncertainties, and share issue authorizations (Articles L. 225-100 and L. 225-100-2 of the French Commercial Code)
Information about items that could affect a public offer, as required by Article L. 225-100-3 of the French Commercial Code