L'Oréal - 2018 Registration Document

2 Corporate Governance PREAMBLE

Powers of General Management 1.2.2. The General Management, which may be carried out by the Chairman of the Board of Directors or by a Chief Executive Officer, is vested with the broadest powers to act in all circumstances in the name of the Company. It must exercise these powers within the limit of the Company’s purpose subject to the powers expressly granted by French law to General Shareholders’ Meetings and the Board of Directors. The Board has the possibility to provide for limitations on the powers of the General Management. Thus, transactions which may materially impact the scope of consolidation of the Company, in particular, transactions involving an amount in excess of €250,000,000 and all new transactions which are outside the normal course of business for an amount in excess of €50,000,000, must be submitted to the Board. In any event, the Board of Directors must be informed of the conclusion and implementation of all transactions. The General Management represents the Company in its dealings with third parties. Upon a proposal by the Chief Executive Officer, the Board may appoint one or more individuals responsible for assisting the Chief Executive Officer, who will hold the corporate office of Deputy Chief Executive Officer(s). The duties of the General Management 1.2.3. Whatever the form of organisation chosen (Chairman and Chief Executive Officer or Chief Executive Officer), the General Management is required to provide each Director with all the documents and information required to carry out their duties. More specifically, the General Management provides the Board members with useful information in connection with the preparation of meetings, or at any time during the life of the Company if the importance or urgency of the information so requires. This provision of ongoing information also includes any relevant information concerning the Company, and in particular press articles and reports containing financial analysis. The General Management gives the Board and its Committees the possibility to meet with the senior managers of L’Oréal within the strict framework of their remits and duties. In consultation with the General Management, the Board and the Committees may use external consultants if they consider it necessary. The Board is informed, at the time of closing of the annual financial statements and the review of the interim financial statements or at any other time if necessary, of the Company’s financial situation and cash position.

are required to act with due care and attention and s participate actively in the work and discussions of the Board; have complete freedom of judgement. s This freedom of judgement enables them in particular to participate, in total independence, in the decisions and work of the Board, and, where appropriate, of its Committees. Independence 2.1.1. The Board reviews the independence of each of its members every year, after obtaining the opinion of the Appointments and Governance Committee, in particular in light of the independence criteria in the AFEP-MEDEF Code and taking account of the specific needs of L’Oréal. The findings of this evaluation are reported to the shareholders and made available to the general public. Diversity 2.1.2. The Board considers the issue of the desirable balance of its composition and that of its Committees, notably in the representation of men and women, nationalities and diversity of skills. The objectives, terms and conditions and results of its policy in this area are made public in the Corporate Governance Report and included in the Registration Document. Terms of office 2.1.3. The length of the term of office of Directors is four years. However, the staggering of the terms of office is organised in order to avoid renewal of too many Directors all at once and favour the harmonious renewal of the Directors. In principle, it is agreed by the Board members that all Directors will tender their resignation to the Board prior to the General Shareholders’ Meeting following their 73 rd birthday and that they will no longer apply for renewal of their term of office if this rule does not enable them to perform their office for at least two years. In any event, in accordance with French law and the Articles of Association, the total number of Directors who are over 70 years of age may not exceed one third of the Directors in office. 2.2 The Board of Directors must elect a Chairman from among its members. The Chairman of the Board organises and oversees the Board’s work and reports thereon to the General Shareholders’ Meeting. He sets the dates and the agenda for Board meetings and leads the discussions. The Chairman is actively involved in defining the Company’s growth strategy and encourages and strengthens, inter alia, links between the Company and the main market players. Chairman of the Board

2.

COMPOSITION OF THE BOARD

Directors 2.1 The Directors of the Company: provide their expertise and professional experience; s

REGISTRATION DOCUMENT / L'ORÉAL 2018

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