LensCrafters 2006 Annual Report Download - page 69

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|69 <
Set out below is a description of the management and control structure adopted by the companies
belonging to the group of Luxottica Group S.p.A. (hereinafter “Luxottica” or the “Company”).
Luxottica adheres to, and, as better described below, is completing certain procedures to comply
with, the corporate governance code issued by the Corporate Governance Committee for listed
companies promoted by Borsa Italiana S.p.A. (hereinafter, “Borsa Italiana”) as amended in March
2006 (hereinafter, the “Corporate Governance Code”).
This report (the “Report”) is drawn up in compliance with the relevant directions and
recommendations of Borsa Italiana and, in particular, with the “Guidelines to prepare the annual
report on the Corporate Governance”, issued by Borsa Italiana, and taking also into account the
“Guidance to prepare the report on the Corporate Governance” issued by Assonime and Emittente
Titoli S.p.A. (“Guida alla compilazione della relazione sulla Corporate Governance”).
I. INTRODUCTION
1. The group of companies owned by Luxottica (hereinafter the “Luxottica Group” or the “Group”),
aworld leader in ophthalmic eyewear, is guided by a single business strategy implemented
through the subsidiaries based in the different countries in which it operates.
2. Luxottica Group comprises 130 companies operating in Europe, the Americas, Australia and
New Zealand, China, South Africa and the Middle East.
The business of the Group, in terms of sales and personnel, is particularly significant in Europe,
North America, Australia and China.
3. Luxottica is listed on the NYSE and the Electronic Share Market (MTA) organized and managed
by Borsa Italiana; thus it must comply with the US and Italian rules applicable to the companies
listed on such markets and, in particular, the regulations issued by the SEC and CONSOB.
4. Luxottica, the parent company, manages and co-ordinates the activities of all companies in the
Group, whether directly or indirectly controlled, aiming at delivering overall profits and
sustainable results for the Luxottica Group.
5. Through the following activities, Luxottica guides and coordinates the Group:
• Preparation of business and sales forecasts;
• Preparation of budgets and identification of specific targets to be achieved and projects to be
implemented;
•Establishment of specific rules to assure an adequate flow of information for the effective
management and control of the Group;
• Examination and approval of extraordinary or particularly significant transactions;
•Implementation of certain financial policies (e.g., definition of indebtedness and cash
investment criteria);
•Implementation of central structures to provide professional services and support to all
companies of the Group;
• Adoption of codes of conduct and procedures binding the entire Group;
• Adoption of common organizational models;
•Adoption of guidelines on the composition, operation and role of the subsidiaries’ Boards of
Directors - including guidelines regarding the delegation of management activities -
consistent with those adopted by Luxottica.
Luxottica's corporate governance framework is applied to the entire Group.
Such governance is implemented in accordance with the mutually compatible recommendations
issued by Borsa Italiana, CONSOB, SEC and NYSE and in compliance with the highest corporate
governance standards.
ANNUAL REPORT
ON CORPORATE
GOVERNANCE 2006