Louis Vuitton 2011 Annual Report Download - page 12

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LVMH 2011
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Governance
The priority objectives of the Board of Directors, the strategic body
of LVMH, are to increase the value of the Company and defend
its social interest. Its principal missions are to adopt the major strategies
of the Company and the Group, monitor the implementation of those
strategies, verify the fair and accurate presentation of information about
the Company and the Group, and protect its corporate assets.
The Board of Directors has adopted a
Charter that spells out the membership,
mission, operations and responsibilities of
the Board. It has nine independent directors
who are free of any interest in the Company.
BOARD OF DIRECTORS
In 2011 the Board of Directors was con-
vened by the Chairman to meet six times.
The Board reviewed the acquisition of
Bulgari, the corporate and consolidated
financial statements, the Group’s major
policy objectives and strategic decisions,
the budget, and the implementation of
bonus share plans. It also assessed its abil-
ity to meet shareholder expectations by
reviewing its membership, organization
and operations, and amended its Charter
and the internal rules for the Performance
Audit Committee and Nominations and
Compensation Committee.
EXECUTIVE MANAGEMENT
The Board of Directors decided not to
separate the positions of Chairman of the
Board of Directors and Chief Executive
Ocer. It made no limitations on the powers
of the Chief Executive Ocer.
On the recommendation of the Chairman
and Chief Executive Ocer, the Board of
Directors has appointed a Managing
Director who has the same powers as the
Chief Executive Ocer.
PERFORMANCE AUDIT COMMITTEE
The primary tasks of the Performance
Audit Committee are to ensure the super-
vision of the process of preparing the
financial information, the eectiveness of
the internal control and risk management
systems and the legal audit of the corporate
and consolidated accounts by the
Independent Auditors. It directs the pro-
cedure for selecting the Auditors and
ensures their independence. It is composed
of at least three members (at least two thirds
of whom are independent) appointed by
the Board of Directors. The Performance
Audit Committee met four times in 2011.
In addition to reviewing the corporate and
consolidated annual and interim financial
statements in conjunction with a detailed
analysis of changes in the Group’s activities
and scope, the Committee focused on the
stake taken in Hermès, the acquisition of
Bulgari, and the risk management and
internal control procedures implemented
within the Group.
NOMINATIONS AND
COMPENSATION COMMITTEE
The primary responsibilities of the
Nominations and Compensation Committee
are to issue:
– recommendations on the compensation,
in-kind benefits, bonus shares and stock
options granted to the Chairman of the
Board of Directors, the Chief Executive
Officer and the Managing Director(s) of
the Company, and on the distribution of
the directors’ fees paid by the Company;
– opinions on candidates for the posi-
tions of Director and Advisor to the Board
or membership on the Executive Committee
of the Group or the Management of its
principal subsidiaries.
The Committee has a minimum of three
members (the majority of whom are inde-
pendent) appointed by the Board of
Directors. The Committee met three times
in 2011. It issued recommendations on the
compensation of the Chairman and Chief
Executive Officer and Group Managing
Director and on their bonus-share award,
and gave its opinion on the compensation,
medium-term profit-sharing, bonus shares
and benefits in kind granted to specific
Directors by the Company or its subsidiaries.
ADVISORY BOARD
There can be no more than nine Advisors
who are appointed for a three-year term.
Advisors participate in deliberations in an
advisory capacity; their absence does not
affect the validity of these proceedings.
The Advisory Board is composed of three
members.
Further information can be found in the 2011 Reference
Document.