Loreal 2011 Annual Report Download - page 53

51REGISTRATION DOCUMENT − L’ORÉAL 2011
Corporate governance
2
The Board’s composition and the way in which theBoard’s work is prepared andorganised
♦the definition of the powers of the Board of Directors; and,
♦the rules relating to the holding and use of privileged
information, which are set out here after in point4.6.
4.2. Respect for the interests of the Company
The Directors are required to act in all circumstances in the interest
of the Company and all its shareholders.
The Directors are under the obligation of notifying the Board
of all situations constituting a conflict of interest, even if such
conflict is only potential, and must refrain from participating in
the corresponding deliberations.
4.3. Obligation of diligence
The Director must devote the necessary time and attention to
his duties.
He must limit the number of offices held so as to ensure his
availability.
Each Board member undertakes to be diligent:
♦by attending all Board meetings, where necessary by means
of videoconference or telecommunication facilities, except
in the case of a major impediment;
♦by attending, wherever possible, all the Shareholders’ General
Meetings;
♦by attending the meetings of the Review Committees of which
he is a member.
4.4. Training of Directors
Each Director may benefit, on his appointment or throughout
his directorship, from the training programmes which he deems
necessary for the exercise of his office.
The training programmes are organised and provided by the
Company, and are at its expense.
4.5. Obligation of reserve andconfidentiality
The Directors undertake not to express themselves individually
other than in the internal deliberations of the Board on questions
raised at Board meetings.
Outside the Company, only collegial expression is possible,
particularly in the form of releases intended to provide the
markets with information.
With regard to information not in the public domain to which
the Director has access as a result of his duties, the Director must
consider himself to be bound by strict professional confidentiality,
which is more demanding than the mere obligation of discretion
stipulated in ArticleL.225-37, paragraph5, of the French
Commercial Code. The obligation of discretion applies to all
persons called on to attend Board meetings, and covers all
information of a confidential nature and all information presented
as confidential by the Chairman of the Board. Beyond this legal
obligation and to ensure the quality of the discussions of the
Board of Directors, the Board has set a rule that all the information
given to Board members and the opinions they express have to
be kept strictly confidential.
4.6. Rules governing insider trading
4.6.1. Principles
Privileged information must only be used by the Director in
the exercise of his office. Such information must in no case be
communicated to a third party other than in the exercise of the
Director’s duties, and for any other purpose or any other activity
than those for which it is held.
It is the duty of all Directors to refrain from trading in, having others
trade in, and enabling others to trade in the securities of the
Company on the basis of this information until such time as the
information has been made public.
It is the personal responsibility of each Director to determine
whether the information he holds is privileged or not, and
accordingly whether he may or may not use or transmit any of
the information, and whether he may or may not trade or enable
trading in the Company’s securities.
4.6.2. Periods of abstention
During the period preceding the publication of any privileged
information to which Directors have access, in their capacity of
insiders, Directors must by law refrain from all trading in L’Oréal
securities.
Furthermore, it is prohibited for them, in accordance with the
AMF’s recommendations, to trade in the Company’s shares over
the following periods:
♦a minimum of 30calendar days before the date of publication
of the press release on the annual and half-year results;
♦a minimum of 15calendar days before the date of publication
of the press release on quarterly financial information.
4.6.3. Insider trading
The Director has been informed of the provisions in force relating
to the holding of privileged information and insider trading:
ArticleL.465-1 of the French Monetary and Financial Code and
Articles621-1
et seq . of the General Regulations of the French
financial markets supervisory authority (AMF).
4.6.4. Obligation of declaring trading in the securities
ofthe Company
In accordance with the applicable regulations, the Directors
and individuals closely related to them, as defined by decree,
must inform the AMF of all acquisitions, sales, subscriptions or
exchanges involving the Company’s financial instruments
and of transactions involving related instruments where the
cumulative amount of such transactions is higher than €5,000
for the calendar year in progress.
The Directors and individuals closely related to them
must submit their declaration to the AMF by e-mail
([e-mail]) within five trading
days following completion of the transaction.
These individuals must simultaneously provide a copy of this
notice to the Secretary of the Company’s Board of Directors.
The declarations are then posted on the AMF’s website and are
mentioned in an annual summary set out in the Company’s
Management Report.