APC 2015 Annual Report Download - page 171

2015 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC 169
CORPORATE GOVERNANCE
3
INTERNAL CONTROL AND RISK MANAGEMENT
–the defi nition of group guidelines and contributes to the
defi nition of Key Internal Control indicators relating to treasury
and credit management;
–reviewing the related risks of complex projects as a subject
matter expert;
• the annual review of fi nancial structures– balance-sheet changes
and fi nancial risks– facing the Group’s companies during formal
fi nancial review meetings.
Procedures for managing fi nancial risk are described in « Risk
Factors» page 37.
Operating Divisions and operating units
The Operating Division management teams play a critical role in
effective internal control.
All Group units report hierachically to one of the Operating Divisions,
which are led or supervised by an Executive Vice-President,
supported by a Chief fi nancial offi cer.
The Executive Vice-Presidents leading or supervising the Operating
Divisions sit on the Executive Committee, which is chaired by the
Chairman and CEO of the Group.
Within each division, the management team organizes control of
operations, ensures that appropriate strategies are deployed to
achieve objectives, and tracks unit performance.
A Management Committee led by the corporate Management
Control and Accounting unit reviews the operations of the Operating
Divisions on a monthly basis.
Global Functions (Human Resources, Supply
Chain, Information Systems,etc.)
In addition to specifi c processes or bodies such as the Group
Acquisitions Committee (see « Risk Factors – Acquisitions »
page 37) for making and implementing strategic decisions and
centralization of certain functions within the Finance and Control–
Legal Affairs Department (see above), Schneider Electric centralizes
certain matters through dedicated Global Functions thus combining
decision-making and risk management at the corporate level.
An Innovation and Technology Council meets 11 times per year,
grouping all Business Chief technology offi cers and Global
Functions involved in Offer Creation, to ensure cross-functional and
cross-business coordination for innovation and offer creation.
The Human Resources Department is responsible for deploying
and ensuring the application of procedures concerning employee
development, occupational health and work safety. The department
is also responsible for establishing guidelines on rewards and
compensation, hiring, on boarding, amongst other Human
Resources related guidelines.
The Purchasing Department within Supply Chain is responsible
for establishing guidelines concerning purchasing organization
and procedures; relationships between buyers and vendors; and
procedures governing product quality, the level of service, and
compliance with environmental standards and Group codes of
conduct.
Global Functions also issue, adapt and distribute policies, target
procedures and instructions to units and individuals assigned to
handle their specifi c duties. Global Functions have correspondents
who work with the Internal Control Department to establish and
update the Key Internal Controls deployed across the Group.
9.3 Distributing information: benchmarks and guidelines
The main internal control benchmarks are available to all employees,
including in the Group’s employee portal. Global Functions send
updates of these r eference d ocuments to the appropriate units and
individuals through their networks of correspondents.
In some cases, dedicated e-mails are sent out or messages are
posted on the employee portal to inform users about publications
or updates.
Whenever possible, the distribution network leverages the
managerial/functional organization to distribute standards
andguidelines.
Principles of Responsibility
See C hapter Ethics& Responsibility, page65 .
Insider code of ethics
This code sets out the rules to be followed by management and
employees to prevent insider trading. It imposes an obligation of
confi dentiality on all employees who have access to confi dential
information. It also sets permanent restrictions on purchases and
sales of Schneider ElectricSE shares by persons who have access
to insider information in the course of their work (see «Organizational
and operating procedures of the board of directors», Chapter3
Section2 page 139). Such persons are prohibited from trading the
Company’s shares at any time if they are in possession of price
sensitive information and during specifi ed periods prior to (and until
the day of) release of the Group’s fi nancial statements and quarterly
information on sales.
International internal auditing standards
The Internal Audit Department is committed to complying with the
international standards published by the Institute of Internal Auditors
(IIA) and other bodies.