LISI GROUP - 2016 Financial report

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LISI 2016 FINANCIAL REPORT

Dear Shareholders,

As an independent third party body accredited by COFRAC

under

No. 3-1050 and a member of the network of one of the auditors of the

LISI Group, we present our report on the consolidated social,

environmental and societal information for the period ended

December 31, 2016, presented in Chapter 6 of the Annual Report,

subsequently referred to as the “CSR information” under the provisions

of Article L. 225-102-1 of the French Commercial Code.

Corporate responsibility

It is for the Board of Directors to prepare a management report

including the CSR information provided for in Article R. 225-105-1 of

the French Commercial Code, in accordance with the standards used

by the Company, consisting of HR and CSR reporting instructions in

their 2016 versions (hereinafter the “Repositories”) and available upon

request at the Company’s headquarters.

Independence and quality control

Our independence is defined in the regulations, the Profession’s

Code of Ethics, as well as the provisions of Article L. 822-11 of the

French Commercial Code. In addition, we have implemented a quality

control system that includes documented policies and procedures to

ensure compliance with ethical standards, professional standards and

applicable laws and regulations.

Responsibility of the independent third party organization

It is for us, based on our work, to:

–

certify that the CSR required information is present in the

management report or if it is omitted, is subject to an explanation

in accordance with the third paragraph of Article R. 225-105 of the

French Commercial Code (CSR information presence certificate);

–

express a moderate conclusion of assurance on the fact that

all significant aspects of the CSR information, taken overall, are

presented sincerely, in compliance with the Repositories (reasoned

opinion on the fairness of the CSR information).

Six competent persons were involved in this work which was carried

out between November 2016 and February 2017 over a total working

period of about five weeks.

We conducted the work described below in accordance with

professional standards applicable in France and the Order of May 13,

2013 determining the conditions under which the independent third

party organization conducts its task and on the reasoned opinion of

fairness, as per the international standard ISAE 3000

Scope of accreditation available at

www.cofrac.fr

ISAE 3000 – Assurance engagements other than audits or reviews of historical information.

1. CSR information presence certificate

Nature and scope of work

We have read, based on interviews with the heads of departments

concerned, the presentation of guidelines for sustainable development,

based on the social and environmental consequences of the Company’s

activities and of its social commitments and, where appropriate, of the

resulting actions or programs.

We compared the CSR information presented in the management

report with the list provided for in Article R. 225-105-1 of the French

Commercial Code.

In the absence of some of the consolidated information, we verified

that explanations were provided in accordance with Article R. 225‑105,

paragraph 3 of the French Commercial Code.

We have verified that the CSR information covered the consolidation

scope, namely the Company as well as its subsidiaries in the meaning

of Article L. 233-1 of the French Commercial Code, the companies

it controls in the meaning of Article L. 233-3 of the same code, with the

limits laid down in the introduction to Chapter 6 of the annual report,

namely that the environment indicators do not include information on

the Remmele site, which was acquired during 2016.

Based on this work and taking the aforementioned limits into account,

we confirm the presence of the required CSR information in our

management report.

2. Reasoned opinion on the fairness of the CSR Information

Nature and scope of work

We conducted nine interviews with the individuals responsible for

preparing the CSR information from Human Resources, Health/

Safety/Environment, in charge of gathering information and, where

appropriate, in charge of the internal audit and risk management

procedures in order to:

–

assess the appropriateness of the Repositories in terms of their

relevance, completeness, reliability, neutrality and understandability,

taking into account, where appropriate, the industry’s best practices;

–

verify the implementation of a process for collecting, compiling,

processing and controlling the completeness and consistency of

the CSR information and for gaining an understanding of the internal

audit and risk management procedures relating to the elaboration

of the CSR information.

REPORT BY THE INDEPENDENT THIRD PARTY ORGANIZATION

REGARDING THE CONSOLIDATED SOCIAL, ENVIRONMENTAL

AND SOCIETAL INFORMATION CONTAINED IN THE LISI MANAGEMENT

REPORT – FINANCIAL YEAR ENDED DECEMBER 31, 2016

Documents specific to the Shareholders General Meeting