LensCrafters 2010 Annual Report Download - page 77

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REPORT ON
CORPORATE
GOVERNANCE
AND OWNERSHIP
STRUCTURE
formulation of guidelines on the composition, operation and role of the board of directors of the subsidiary companies •
as well as on the assignment of management responsibilities in the subsidiary companies, consistent with those
adopted by the parent company.
The corporate governance system of the parent company, applicable to all the companies belonging to Luxottica Group,
is based on five key principles:
defined, acknowledged and shared values, which are set out in the Code of Ethics;1)
the central role of the Board of Directors;2)
the effectiveness and transparency of management decisions;3)
the adoption of an adequate internal control system; and4)
the adoption of proper and transparent rules regarding transactions carried out by related parties and the processing 5)
of confidential information.
The system is established in compliance with the provisions of Borsa Italiana, CONSOB, the SEC and the New York Stock
Exchange (“NYSE”), according to the highest standards of corporate governance.
The values established in the Code of Ethics of Luxottica Group bind all employees to ensure that the activities of the
Group are performed in compliance with applicable law, in the context of fair competition, with honesty, integrity and
fairness, respecting the legitimate interests of shareholders, employees, clients, suppliers, business and financial partners,
as well as of the societies of the countries in which Luxottica Group operates.
II. STRUCTURE OF LUXOTTICA GROUP S.P.A. AND INFORMATION ON THE OWNERSHIP STRUCTURE PURSUANT
TO ART. 123 OF ITALIAN CONSOLIDATED FINANCIAL LAW
The Luxottica governance system – based on a traditional management and control system – is characterized by the
presence of:
a Board of Directors, responsible for the management of the Company; •
a Board of Statutory Auditors, responsible for supervising: (i) compliance with applicable law and with the Company’s •
by–laws; (ii) compliance with the principles of correct administration; (iii) the adequacy of the organizational structure,
the internal control system and the accounting management system, as well as its reliability to correctly report the
affairs of the Company; (iv) the procedures to implement the corporate governance rules provided for by the codes
of conduct compiled by organizations managing regulated markets or by trade associations, with which the Company
declares to comply by making a public announcement; (v) the adequacy of the regulations given by the Company
to the subsidiary companies pursuant to Art. 114, paragraph 2 of the Italian Consolidated Financial Law; and (vi)
according to the provisions of Italian Legislative Decree 39/2010, the process of financial information, the effectiveness
of the internal auditing and management risk system, the auditing of accounts and the independence of the statutory
auditor. The Luxottica Group Board of Statutory Auditors also acts as the Audit Committee pursuant to SOX;
the Shareholders’ meeting, which has the power to vote – both in ordinary and extraordinary meetings – among other •
things, upon (i) the appointment and removal of the members of the Board of Directors and of the Board of Statutory
Auditors and their remuneration, (ii) the approval of the annual financial statements and the allocation of profits, (iii)
amendments to the Company’s by–laws.
The task of auditing is assigned to an audit company listed on the special CONSOB register and appointed by the
Shareholders’ Meeting.
The powers and responsibilities of the Board of Directors, of the Board of Statutory Auditors, of the Shareholders’ Meeting
and of the Audit Committee are illustrated more in detail later in the Report.
The Company’s share capital is made up exclusively of ordinary, fully paid–up voting shares, entitled to voting rights both
at ordinary and extraordinary shareholders’ meetings. As of January 31, 2011, the share capital was Euro 27,974,925.60,
made up of 466,248,760 shares, each with a nominal value of Euro 0.06.