Loreal 2011 Annual Report Download - page 48

46 REGISTRATION DOCUMENT − L’ORÉAL 2011
2Corporate governance
The Board’s composition and the way in which theBoard’s work is prepared andorganised
In light of the changes in the remits and work of the committees,
the committee asked the Board to approve the new rules for
the allocation of attendance fees, then proposed the amounts
allocated in respect of the 2011 financial year in light of the
actual presence of Directors at Board meetings and on a
prorated basis according to their membership of one or more
committees.
The committee examined the Group’s resources in terms of
talent, of both men and women, at the various brands and in
different countries. The Group has a high-quality pool of talent
to build L’Oréal’s future success.
The committee reviewed the new requirements resulting from
the “GrenelleII” Law with regard to the information which will
shortly have to be published on social matters and was informed
of the implementation of the ethical principles within the Group.
The committee reported to the Board on all its work.
2.2.2.2. Self-evaluation by the Board
ofDirectors
Every year, the Board reviews its composition, its organisation
and its modus operandi. On the basis of a summary of prior
individual interviews between the Director and the Secretary
of the Board, the Board considers the avenues of progress that
still remain open and, at the end of the discussion that takes
place, adopts the improvement measures that it considers
appropriate. This review is carried out within the framework of
the AFEP-MEDEF Code, to which the Board refers.
The Directors again exercised their complete freedom of
judgment in2011. This freedom of judgment allowed them to
participate, in total independence, in the work and collective
decisions of the Board, and, where applicable, in conducting
preparatory work and making proposals through the Board
c ommittees.
The Board considered that the quality of its meetings has
continued to improve, in light of what were considered as
avenues of progress following the self-evaluation carried out
at the end of 2010, particularly with regard to the strategic
challenges faced by the Group which are regularly debated
and discussed, in the presence of the senior managers who
are members of the Executive Committee. Once again this year,
the approach to strategy was examined in detail in the course
of the Board’s work in light of the development of the brands,
the countries and the markets on which the Group operates
and, within this framework, the Board’s attention focused in
particular on the major evolutions in Research & Innovation
which are at the heart of the Group’s strategy. In2011, the Board
devoted a whole day to Research in one of its laboratories.
L’Oréal’s Research is essential for the Group’s growth, through its
discoveries, in compliance with the quality, safety and efficiency
standards and in the service of performance for the consumer,
everywhere in the world. L’Oréal has established an international
presence of its Research & Innovation activities with 5 regional
poles: in France, the USA, Japan, China and Brazil.
In2011, the Board appreciated the rhythm, frequency and
format of the information provided to it in connection with
business activities in general and the main events in the life
of the Group. Making documentation available prior to Board
or c ommittee meetings, in compliance with the requirements
of confidentiality and the time constraints with which the
Company is faced, favours the quality of the debates.
The Directors made new proposals of topics to be included on
the agenda for meetings in2012, principally in relation with the
areas for development of the Group, in high-growth zones and
on new markets.
2.2.2.3. Appendix: complete text
oftheInternal Rules of the Board
ofDirectors
At the beginning of2011, the Board decided to update its Internal
Rules in order to add to the remits of two of its committees, give
a reminder of the need to strictly respect the confidentiality of
the information that it is called on to handle and specify that
Board members are prohibited from trading in the Company’s
shares during certain specific periods.
Preamble
These Rules are applicable to all present and future Directors,
and are intended to complement the legal, regulatory and
statutory rules in order to state accurately the modus operandi
of the Board of Directors and its Review Committees, in the best
interests of the Company and of its shareholders.
L’Oréal’s Board of Directors refers to the principles of corporate
governance as presented by the AFEP-MEDEF Code.
1. Duties and authority oftheBoard of Directors
1.1. Board of Directors
The Board of Directors determines the Company’s business
strategy and oversees the implementation thereof.
Subject to the powers expressly conferred during General
Shareholders’ Meetings and within the limit of the Company’s
purpose, the Board deals with all matters regarding the smooth
running of the Company and settles issues concerning the
Company by virtue of its decisions.
The Board of Directors is a collegial body which collectively
represents all the shareholders and which is required to act in
all circumstances in the interest of the Company.
The Board of Directors carries out the controls and verifications
it considers appropriate.
The Company’s Chairman or Chief Executive Officer must
provide each Director with all of the documents and information
required to carry out his/her duties.
The Board of Directors may entrust one or more of its members
or third parties with special assignments or projects with a view,
inter alia , to examining one or more specific topics.
It can decide to set up committees responsible for examining
matters submitted by the Board or its Chairman for their opinion.