Alcatel-Lucent

The Chief Compliance Officer and the General Counsel present the status of the Group's Ethics and Compliance Program to the Board of Directors at least twice a year. In addition, at the request of the Chairman of the Board, the Office of Business Integrity & Compliance developed a training program to ensure that Board members are knowledgeable about critical areas of Ethics and Compliance, with a focus on Anti-Corruption.

The specific responsibilities of the Chief Compliance Officer include:

• Overseeing and monitoring the implementation of the Company's compliance activities, with particular focus on Anti-Corruption.
• Coordinating the education and training programs that focus on ethics and compliance.
• Assisting senior financial management in coordinating internal compliance reviews and disclosure decisions.
• Ensuring independent investigation and action, as appropriate, on compliance matters.
• Developing policies and programs to encourage reporting of suspected fraud or other misconduct without fear of retaliation.
• Establishing procedures to capture and record compliance violations.

Law; Human Resources & Communications; Information Technology; Internal Audit; Finance; Global Supply Chain & Procurement; and the Office of Business Integrity & Compliance. Chaired by the Office of Business Integrity & Compliance, the Council meets monthly and is responsible for overseeing the design and implementation of a comprehensive companywide ethics and compliance system.
Key responsibilities of the Alcatel-Lucent Ethics and Compliance Council include:

• Monitor the major regulatory and policy developments of the company's compliance program areas and report on the associated business impact.
• Review compliance trends (hotline data, compliance repository reports, disciplinary actions and compliance dashboard metrics) to identify and address systemic ethics and compliance issues across the company and to ensure consistent enforcement of discipline.
• Establish the appropriate culture of ethics and compliance through review and approval of significant compliance communications, i.e., compliance alerts, training launch letters, policy communications.
• Monitor independent investigations and actions on compliance matters, and report significant regulatory, compliance and ethics issues to the senior leadership within the company and to the Alcatel-Lucent Board of Directors, including the Audit and Finance Committee, as appropriate.

In addition to the Corporate Ethics and Compliance Council a dedicated organization has been set up to cascade down the program and ensure its implementation at each level of the company.

and designed to detect and avoid business and legal risks. Acting as an interface with employees, the OBIC helps guide employees in ethical business dealings and provides information about the company's policies and compliance programs.

In addition, the Office of Business Integrity & Compliance website provides access to relevant articles, messages, and links to all compliance policies, contacts and available training. The website includes directions for reporting compliance issues. Alcatel-Lucent management has identified and monitors 18 key compliance areas, calculating risk assessments against the significance and likelihood of a violation for each one. Highest priority is attached to anticorruption and compliance with the National Security Agreement with the U.S. government. This agreement is a contract that the company signed with the U.S. government as a requirement for the Alcatel and Lucent merger. It governs access to critical product intellectual property and service provider end-user information.

Alcatel-Lucent is committed to respecting individuals' privacy rights and expectations and to protecting the personal data it collects from unauthorized access, use, retention/storage and/or disclosure. Over the course of 2010, the Group implemented Global Privacy and Data Protection Policies to fulfil this commitment. In 2011, the focus of the Global Privacy and Data Protection program will be on assessing ad increasing the compliance profile for the Group's 50 most critical applications. Awareness and training efforts will be reinforced with material targeted to specific audiences, such as information technology, human resources and sales and marketing. The organization also aims to develop metrics to measure the effectiveness and track progress of the Group's privacy and date protection initiatives.

Where permitted by local laws, employees have access to a 24/7 hotline to report compliance issues, concerns, violations or suspected violations of law or company policy. The Compliance Hotline has been formally deployed in 114 countries and is available via a multilingual webface in 12 languages and via telephone access in more than 120 languages. The Company has a "no retaliation" policy, which specifically prohibits adverse action against employees who report in good faith suspected violations of law or company policy.