Hermès // 2021 Universal Registration Document

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MESSAGE FROM THE EXECUTIVE MANAGEMENT5
HIGHLIGHTS 20216
1. PRESENTATION OF THE GROUP AND ITS RESULTS9
1.1 SIX GENERATIONS OF CRAFTSPEOPLE10
1.2 GROUP GOVERNANCE13
1.3 STRATEGY14
1.4 SIMPLIFIED ORGANIZATION CHART AND GROUP LOCATIONS17
1.4.1 SUMMARY DESCRIPTION OF THE GROUP AS AT 31 DECEMBER 202117
1.4.2 PRODUCTION SITES18
1.4.3 DISTRIBUTION NETWORK20
1.4.4 REAL ESTATE23
1.5 KEY FINANCIAL FIGURES24
1.5.1 REVENUE BY MÉTIER FOR 2021 (2020)24
1.5.2 REVENUE BY GEOGRAPHICAL AREA FOR 2021 (2020)24
1.5.3 KEY CONSOLIDATED DATA24
1.6 REVENUE AND ACTIVITY BY MÉTIER26
1.6.1 LEATHER GOODS & SADDLERY26
1.6.2 READY-TO-WEAR AND ACCESSORIES28
1.6.3 SILK AND TEXTILES29
1.6.4 OTHER HERMÈS SECTORS30
1.6.5 PERFUME AND BEAUTY31
1.6.6 WATCHES32
1.6.7 OTHER PRODUCTS AND BRANDS32
1.6.8 GROUP PARTNERSHIPS35
1.7 REVENUE AND ACTIVITY BY GEOGRAPHICAL AREA35
1.7.1 EUROPE35
1.7.2 ASIA-PACIFIC36
1.7.3 AMERICAS37
1.7.4 DIGITAL STRATEGY37
1.8 COMMENTS ON THE CONSOLIDATED FINANCIAL STATEMENTS38
1.8.1 INCOME STATEMENT38
1.8.2 CASH FLOWS AND INVESTMENTS39
1.8.3 FINANCIAL POSITION39
1.9 SIGNIFICANT EVENTS SINCE THE END OF THE FINANCIAL YEAR40
1.10 OUTLOOK41
1.11 FONDATION D’ENTREPRISE42
2. CORPORATE SOCIAL RESPONSIBILITY45
2.1 BUSINESS MODEL47
2.1.1 CONCRETE LONG-TERM COMMITMENTS52
2.1.2 AN AMBITIOUS AND STRUCTURING CSR STRATEGY53
2.1.3 MATERIALITY ANALYSIS54
2.1.4 ANALYSIS OF NON-FINANCIAL RISKS56
2.1.5 CSR STRATEGY57
2.1.6 GOVERNANCE OF THE CSR APPROACH61
2.2 PEOPLE: TEAMS67
2.2.1 FULFILMENT AND WELL-BEING70
2.2.2 DIVERSITY AND INCLUSION79
2.3 PEOPLE: SAVOIR-FAIRE89
2.3.1 GENERAL INFORMATION ABOUT EMPLOYEES92
2.3.2 ACQUISITION, ENRICHMENT AND TRANSMISSION92
2.3.3 PRESERVATION OF CRAFTSMANSHIP HERITAGE100
2.4 THE PLANET: RAW MATERIALS109
2.4.1 ECODESIGN AND CIRCULAR ECONOMY112
2.4.2 SUPPLY CHAINS117
2.5 THE PLANET: ENVIRONMENT129
2.5.1 ENVIRONMENTAL ACTIONS FRAMEWORK132
2.5.2 RESOURCE MANAGEMENT133
2.5.3 REDUCE THE FOOTPRINT AND CONTROL WASTE AND DISCHARGES139
2.5.4 CLIMATE CHANGE144
2.5.5 BIODIVERSITY154
2.6 COMMUNITIES: SUPPLIERS & PARTNERS167
2.6.1 SUPPORT AND CONTROL170
2.6.2 RESPONSIBLE PRACTICES WITH SOCIALLY SUPPORTED ORGANISATIONS176
2.7 COMMUNITIES: STAKEHOLDERS AND TRANSPARENCY181
2.7.1 REGIONAL RESPONSIBILITY IN FRANCE184
2.7.2 SOCIALLY RESPONSIBLE COMPANY186
2.8 ETHICS – COMPLIANCE198
2.8.1 PROMOTING ETHICS198
2.8.2 THE FIGHT AGAINST CORRUPTION202
2.8.3 PERSONAL DATA PROTECTION205
2.8.4 DUTY OF CARE206
2.9 REPORT BY ONE OF THE STATUTORY AUDITORS, APPOINTED AS AN INDEPENDENT THIRD PARTY, ON THE CONSOLIDATED NON-FINANCIAL INFORMATION STATEMENT INCLUDED IN THE MANAGEMENT REPORT212
2.10 REASONABLE ASSURANCE REPORT BY ONE OF THE STATUTORY AUDITORS ON A SELECTION OF ENVIRONMENTAL AND SOCIAL INFORMATION PUBLISHED IN THE MANAGEMENT REPORT OF217
3.CORPORATE GOUVERNANCE221
SUPERVISORY BOARD CORPORATE GOVERNANCE REPORT223
3.1 THE COMPANY’S CORPORATE GOVERNANCE CODE223
3.1.1 CORPORATE GOVERNANCE PRINCIPLES APPLIED223
3.1.2 PROVISIONS OF THE AFEP-MEDEF CORPORATE GOVERNANCE CODE NOT APPLIED AND THOSE NEWLY COMPLIED WITH223
3.2 AMBITIOUS AND BALANCED GOVERNANCE226
3.2.1 ORGANISATIONAL STRUCTURE OF HERMÈS INTERNATIONAL AS AT 31 DECEMBER 2021226
3.2.2 TWO TYPES OF PARTNERS227
3.2.3 GOVERNANCE BY NATURE DISSOCIATED228
3.3 ADMINISTRATIVE AND MANAGEMENT BODIES229
3.3.1 THE ACTIVE PARTNER AND ITS EXECUTIVE MANAGEMENT BOARD229
3.3.2 EXECUTIVE MANAGEMENT230
3.3.3 GOVERNING BODIES234
3.3.4 NON-DISCRIMINATION AND DIVERSITY POLICY238
3.3.5 SUCCESSION PLAN FOR SENIOR EXECUTIVES240
3.4 ORGANISATION OF THE SUPERVISORY BOARD241
3.4.1 KEY DATA ON THE SUPERVISORY BOARD AS AT 31 DECEMBER 2021241
3.4.2 APPLICABLE PRINCIPLES242
3.4.3 DIVERSITY POLICY APPLIED WITHIN THE SUPERVISORY BOARD244
3.4.4 SUCCESSION PLAN FOR THE CHAIRMAN OF THE SUPERVISORY BOARD246
3.4.5 COMPOSITION OF THE SUPERVISORY BOARD247
3.4.6 INDEPENDENCE OF THE MEMBERS OF THE SUPERVISORY BOARD251
3.4.7 SUPERVISORY BOARD ETHICS253
3.4.8 INFORMATION ON SITTING MEMBERS OF THE SUPERVISORY BOARD256
3.5 FUNCTIONING OF THE SUPERVISORY BOARD276
3.5.1 ROLE OF THE SUPERVISORY BOARD276
3.5.2 MEETINGS OF THE SUPERVISORY BOARD AND THE JOINT COUNCIL277
3.5.3 INFORMATION AND TRAINING OF THE SUPERVISORY BOARD278
3.5.4 MAIN DUTIES OF THE SUPERVISORY BOARD AND WORK CARRIED OUT IN 2021281
3.5.5 ETHICS AND COMPLIANCE – PERSONAL DATA PROTECTION282
3.5.6 CORPORATE SOCIAL RESPONSIBILITY (CSR)283
3.5.7 COMPENSATION AND REIMBURSEMENT OF EXPENSES283
3.6 SPECIALISED COMMITTEES284
3.6.1 APPLICABLE PRINCIPLES284
3.6.2 CAG-CSR COMMITTEE285
3.6.3 AUDIT AND RISK COMMITTEE288
3.7 EVALUATION OF THE SUPERVISORY BOARD AND COMMITTEES290
3.7.1 METHODOLOGY290
3.7.2 CHANGES SINCE THE LAST EVALUATIONS291
3.7.3 ANNUAL DISCUSSION IN 2021 ON THE FUNCTIONING OF THE BOARD292
3.8 COMPENSATION AND BENEFITS OF CORPORATE OFFICERS293
3.8.1 COMPENSATION POLICY FOR THE EXECUTIVE CHAIRMEN (EXECUTIVE CORPORATE OFFICERS) AND MEMBERS OF THE SUPERVISORY BOARD (NON-EXECUTIVE CORPORATE OFFICERS)293
3.8.2 OVERVIEW OF COMPENSATION AND BENEFITS OF ALL KINDS FOR CORPORATE OFFICERS303
3.8.3 ALLOCATION OF FREE SHARES AND STOCK OPTIONS308
3.8.4 TABLES DRAWN UP IN ACCORDANCE WITH AMF POSITION-RECOMMENDATION DOC 2021-02 (§ 13.3) OF 5 JANUARY 2022 ON THE PRESENTATION OF COMPENSATION309
3.9 OTHER INFORMATION315
3.9.1 AGREEMENTS315
3.9.2 CAPITAL STRUCTURE AND FACTORS LIABLE TO AFFECT THE OUTCOME OF A PUBLIC OFFERING318
3.9.3 SPECIAL CONDITIONS FOR ATTENDING GENERAL MEETINGS319
3.9.4 SUMMARY TABLE OF THE USE OF FINANCIAL DELEGATIONS OF AUTHORITY321
3.10 OTHER INFORMATION FROM THE EXECUTIVE MANAGEMENT REPORT324
3.10.1 INTERESTS OF CORPORATE OFFICERS AND EXECUTIVE COMMITTEE MEMBERS IN THE SHARE CAPITAL324
3.10.2 DECLARATIONS CONCERNING CORPORATE OFFICERS AND THE EXECUTIVE COMMITTEE325
4. RISK FACTORS AND MANAGEMENT327
4.1 RISK FACTORS328
4.1.1 RISKS RELATED TO STRATEGY AND OPERATIONS330
4.1.2 INDUSTRIAL RISKS335
4.1.3 LEGAL AND REGULATORY RISKS339
4.1.4 RISKS RELATED TO SOCIAL, SOCIETAL AND ENVIRONMENTAL RESPONSIBILITY340
4.1.5 FINANCIAL RISKS344
4.2 INSURANCE POLICY AND RISK HEDGING347
4.3 RISK MANAGEMENT, INTERNAL CONTROL AND INTERNAL AUDIT348
4.3.1 A DEMANDING CONTROL ENVIRONMENT348
4.3.2 COMMITTED PARTIES RESPONSIBLE FOR RISK MANAGEMENT AND CONTROL348
4.3.3 A CONTROLLED RISK MANAGEMENT SYSTEM351
4.3.4 A MATURE INTERNAL CONTROL SYSTEM352
4.3.5 AN AGILE INTERNAL AUDIT SYSTEM355
5. CONSOLIDATED FINANCIAL STATEMENTS359
5.1 CONSOLIDATED INCOME STATEMENT360
5.2 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME360
5.3 CONSOLIDATED BALANCE SHEET361
5.4 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY362
5.5 CONSOLIDATED STATEMENT OF CASH FLOWS363
5.6 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS364
5.7 5.7 STATUTORY AUDITORS’ REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS404
6. PARENT COMPANY FINANCIAL STATEMENTS411
6.1 INCOME STATEMENT412
6.2 BALANCE SHEET413
6.3 CHANGE IN EQUITY414
6.4 STATEMENT OF CASH FLOWS414
6.5 NOTES TO THE FINANCIAL STATEMENTS415
6.6 TABLE OF RESULTS OVER THE LAST FIVE YEARS430
6.7 INFORMATION ON PAYMENT TERMS431
6.8 OTHER INFORMATION ON THE PARENT COMPANY FINANCIAL STATEMENTS432
6.8.1 INFORMATION ON BRANCHES432
6.8.2 INFORMATION ON THE AMOUNT OF INTER-COMPANY LOANS432
6.8.3 EQUITY INVESTMENTS IN COMPANIES HAVING THEIR REGISTERED OFFICE IN FRANCE (ARTICLE L. 233-6 OF THE FRENCH COMMERCIAL CODE (CODE DE COMMERCE))432
6.9 STATUTORY AUDITORS’ REPORT ON THE FINANCIAL STATEMENTS433
7. INFORMATION ON THE COMPANY AND ITS SHARE CAPITAL439
7.1 PRESENTATION OF HERMÈS INTERNATIONAL440
7.1.1 GENERAL INFORMATION ABOUT HERMÈS INTERNATIONAL440
7.1.2 ROLE OF HERMÈS INTERNATIONAL440
7.1.3 COMMENTED ARTICLES OF ASSOCIATION OF HERMÈS INTERNATIONAL440
7.1.4 SIMPLIFIED ORGANISATION CHART AND MAIN SUBSIDIARIES448
7.1.5 PRINCIPAL FLOWS BETWEEN HERMÈS INTERNATIONAL AND THE MAIN SUBSIDIARIES449
7.1.6 HERMÈS GROUP TAX POLICY449
7.1.7 INVESTMENTS449
7.2 INFORMATION ON SHARE CAPITAL AND SHAREHOLDERS450
7.2.1 INFORMATION ON SHARE CAPITAL450
7.2.2 INFORMATION ON SHAREHOLDERS450
7.2.3 TRANSACTIONS PERFORMED BY CORPORATE OFFICERS AND THOSE CLOSE TO THEM ON THE SHARES OF THE COMPANY457
7.2.4 STOCK MARKET ETHICS CODE458
7.2.5 MATERIAL CONTRACTS, SHAREHOLDER PACTS AND AGREEMENTS459
7.3 DIVIDEND POLICY461
7.3.1 PRINCIPLES461
7.3.2 PROPOSAL SUBMITTED TO THE 2022 GENERAL MEETING461
7.4 STOCK MARKET INFORMATION462
7.4.1 SUMMARY OF STOCK MARKET INFORMATION462
7.4.2 HISTORY OF MONTHLY TRANSACTIONS462
7.4.3 HERMÈS SHARE PRICE HISTORY463
7.5 SHAREHOLDER INFORMATION466
7.5.1 RELATIONS WITH SHAREHOLDERS466
7.5.2 SECURITIES SERVICE466
7.5.3 DOCUMENTS AVAILABLE TO THE PUBLIC466
7.5.4 BECOMING A HERMÈS INTERNATIONAL SHAREHOLDER466
7.5.5 DIALOGUE WITH SHAREHOLDERS AND THE FINANCIAL COMMUNITY IN 2021467
7.5.6 FINANCIAL CALENDAR FOR 2022468
7.5.7 REGULATED INFORMATION468
7.5.8 OBLIGATIONS OF DECLARATION OF THRESHOLD CROSSINGS AND NOMINATIVE REGISTRATION468
8. COMBINED GENERAL MEETING OF 20 APRIL 2022471
8.1 AGENDA472
8.1.1 ORDINARY BUSINESS472
8.1.2 EXTRAORDINARY BUSINESS473
8.2 EXPLANATORY STATEMENTS AND DRAFT RESOLUTIONS474
8.2.1 ORDINARY BUSINESS474
8.2.2 EXTRAORDINARY BUSINESS490
8.3 SUPERVISORY BOARD REPORT TO THE COMBINED GENERAL MEETING OF 20 APRIL 2022496
8.4 STATUTORY AUDITORS’ REPORTS498
8.4.1 STATUTORY AUDITORS’ REPORT ON THE FINANCIAL STATEMENTS498
8.4.2 STATUTORY AUDITORS’ REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS498
8.4.3 STATUTORY AUDITORS’ SPECIAL REPORT ON RELATED-PARTY AGREEMENTS499
8.4.4 REPORT BY ONE OF THE STATUTORY AUDITORS, DESIGNATED AS AN INDEPENDENT THIRD PARTY, ON THE CONSOLIDATED SOCIAL, ENVIRONMENTAL AND SOCIETAL INFORMATION CONTAINED IN THE MANAGEMENT REPORT501
8.4.5 STATUTORY AUDITORS’ REPORT ON THE SHARE CAPITAL REDUCTION (SEVENTEENTH RESOLUTION)501
8.4.6 STATUTORY AUDITORS’ REPORT ON THE AUTHORISATION TO GRANT SHARE PURCHASE OPTIONS (EIGHTEENTH RESOLUTION)502
8.4.7 STATUTORY AUDITORS’ REPORT ON THE AUTHORISATION TO GRANT EXISTING SHARES FREE OF CONSIDERATION (NINETEENTH RESOLUTION)503
9. ADDITIONAL INFORMATION505
9.1 9.1 PERSONS RESPONSIBLE FOR THE UNIVERSAL REGISTRATION DOCUMENT506
9.1.1 NAME AND FUNCTION OF PERSONS RESPONSIBLE FOR THE INFORMATION CONTAINED IN THE UNIVERSAL REGISTRATION DOCUMENT506
9.1.2 CERTIFICATION BY THE PERSONS RESPONSIBLE FOR THE UNIVERSAL REGISTRATION DOCUMENT506
9.2 PERSONS RESPONSIBLE FOR AUDITING THE FINANCIAL STATEMENTS507
9.3 CONSULTATION OF REGULATORY INFORMATION507
9.4 INFORMATION INCLUDED BY REFERENCE507
9.5 CROSS REFERENCE TABLES510
9.5.1 CROSS-REFERENCE TABLE FOR THE ANNUAL FINANCIAL REPORT513
9.5.2 CROSS-REFERENCE TABLE FOR THE MANAGEMENT REPORT514
9.5.3 CROSS-REFERENCE TABLE FOR THE SUPERVISORY BOARD REPORT ON CORPORATE GOVERNANCE517
9.5.4 CROSS-REFERENCE TABLE FOR THE UNIVERSAL REGISTRATION DOCUMENT519
9.5.5 CROSS-REFERENCE TABLE FOR THE NON-FINANCIAL PERFORMANCE STATEMENT525
9.5.6 TCFD CROSS-REFERENCE TABLE526
9.6 GLOSSARY527

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