Rothschild & Co: Annual Report 2020

Rothschild & Co

Annual Report 2020

One Group organised around

3 businesses

• Global Advisory
• Wealth and Asset Management
• Merchant Banking

3,587 employees

62 locations

43 countries

Contents

Message from the Chairman of the Supervisory Board	2
Message from the Management Board	4
1.	Overview
	Overview of businesses	8
	Rothschild & Co business model	10
	World presence	12
	Corporate governance	14
	Organisation chart as at 31 December 2020	17
	Corporate Responsibility	18
	Rothschild & Co and its shareholders	22

2.	Business review
	Global Advisory	28
	Wealth and Asset Management	34
	Merchant Banking	38

3.	Management report
	A. Activities and results for the 2020 financial year	50
	B. Information on the Company and its share capital	60
	C. Internal control, risk management and accounting procedures	76
	D. Corporate Responsibility	83
	E. Report on corporate governance	128

4.	Financial statements
	Consolidated financial statements	172
	Statutory auditors' report on the consolidated
	financial statements	236
	Parent Company financial statements	239
	Statutory auditors' report on the parent company
	financial statements	251
General Information
Abbreviations and glossary	256
Statement by the persons responsible for the annual financial report	259
Other information	260

Rothschild & Co | Annual Report 2020      1

Message from the Chairman of the Supervisory Board

Dear Shareholders,

At the end of what can only be described a tumultuous year, when the world faced unprecedented challenges, I would like to thank the Supervisory Board members for their continued support and engagement with Rothschild & Co. We all benefit hugely from their experience and wisdom both during and outside our Board meetings. This year, given the particular circumstances, the Board met on seven separate occasions, notably to review the impact of and responses to COVID-19.

Rothschild & Co's heritage and strong foundations give us a unique perspective at times of crises, and throughout our history we have built our reputation on providing sound advice for our clients. This pandemic is no different and the Managing Partner, represented by Alexandre de Rothschild, Executive Chairman, and the three Managing Partners, Marc-Olivier Laurent, Robert Leitão and François Pérol, have shown exceptional leadership under the most difficult and challenging of circumstances this year.

At the Annual General Meeting held on 14 May 2020, the shareholders approved the re-election of Éric de Rothschild and Suet-Fern Lee, and the appointment of Gilles Denoyel as members of the Supervisory Board for a period of three years. Angelika Gifford, retired from the Board and I would like to thank her for her dedication and insightful input that she brought to our Board meetings during the more than five years that she was a member.

François Henrot retired from his position as observer on the Board in May 2020. François first joined the Board of Rothschild & Co in 2010 and was appointed to be Vice-Chairman of the Board at the time of the Group's reorganisation in 2012. For the past ten years, he has been a loyal and wise counsel to us. François's immense contribution to the Board meetings will be missed and

I would like to thank him, on behalf of the Board, for his dedication to the Group over this period.

Following the departure of Angelika Gifford, we were delighted to announce the nomination of Véronique Weill as Board member. Véronique Weill has enjoyed a highly successful career in financial services, including at both J.P. Morgan and AXA group. Her experience and in-depth understanding of finance, M&A, new technology and digital will be real assets to the Board. In December, Véronique was appointed to be a member of the Remuneration and Nomination Committee.

2      Rothschild & Co | Annual Report 2020

Gilles Denoyel's career spans both the public and private sector in France, and he is reputed as a leading financial expert. The Board has already benefitted from his expertise in the French and international banking sector, in particular with regard to risk and compliance, as well as his regular practice of relations with the regulatory authorities including the ACPR. Gilles has been appointed to be a member of both the Risk Committee and the Audit Committee.

We are delighted that both Véronique and Gilles have accepted our invitation to join the Board, and we are fortunate to enjoy already the benefits of working with them.

As I informed you in my message last year, a Board Committee has been set up to cover Corporate Responsibility. Lucie Maure-Aubert has accepted

to act as Chairwoman of our Corporate Responsibility Committee, which is also made up of Carole Piwnica and Anthony de Rothschild.

In this annual report, as well as on the Company's website, you will find detailed information on the composition of the Supervisory Board and its specialised committees, as well as the other directorships held by the Board members.

In our Annual General Meeting (AGM) document to be published soon on our website, you will find the information about the members of the Board due to be re-elected at this year's Annual General Meeting.

Following the recommendations of our regulator, no dividend payment was made in 2020 and the dividend proposed to the AGM in May 2021 will be restricted, in spite of Rothschild & Co's strong performance. However, it is the Group's intention to make an exceptional interim dividend payment in respect of the 2021 financial year, if and when allowed by our regulator, in order to revert to a global payout more in line with our usual distribution policy.

Finally, I would also like to congratulate all the teams in our Group, in the 43 countries where we are present, who, despite the difficulties linked to the pandemic, have continued to provide their daily assistance effectively, thus contributing for a large part to the success of Rothschild & Co in 2020.

Last, but not least, I would like to thank our shareholders for their valuable support and express my sincere gratitude.

David de Rothschild

Chairman of the Supervisory Board of Rothschild & Co

Rothschild & Co | Annual Report 2020      3