Loreal 2011 Annual Report Download - page 49

47REGISTRATION 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 Directors of the Company:
♦provide their expertise and professional experience;
♦are required to act with due care and attention, and have
complete freedom of judgement.
This freedom of judgement enables them in particular to
participate, in total independence, in the decisions and work
of the Board, and, where appropriate, of its Review Committees.
In principle, it is agreed by the Board members that all Directors
will tender their resignation to the Board prior to the Annual
General Meeting following their 73rdbirthday and that they will
no longer apply for renewal of their tenure if this rule does not
enable them to perform their office for at least two years.
In any event, in accordance with French law and the Articles of
Association, the total number of Directors who are over 70years
of age may not exceed one third of the Directors in office.
The staggering of the terms of office is organised in order to
avoid renewal of too many Directors all at once and favour the
harmonious renewal of the Directors.
1.2. Chairman of the Board of Directors
The Board of Directors must elect a Chairman from among its
members.
The Chairman of the Board of Directors organises and oversees
the Board’s work and reports thereon to the Shareholders’
Annual General Meeting.
The Chairman is actively involved in defining the Company’s
growth strategy and encourages and strengthens, inter alia, links
between the Company and the main market players.
The Chairman oversees the work of the Company’s bodies
responsible for corporate governance and ensures, in particular,
that the Directors are able to perform their duties. He may ask
for any document or information that is likely to assist the Board
of Directors in preparing for its meetings.
The Chairman of the Board of Directors must use his best efforts
to promote the values and image of the Company at all times.
The Chairman expresses his views in that capacity.
He is provided with the material resources required to perform
his duties.
1.3. Form of G eneral M anagement
The Board of Directors determines the form of the Company’s
General Management.
General Management of the Company is carried out, under his
responsibility, by either the Chairman of the Board of Directors
or by another individual appointed by the Board of Directors
with the position of Chief Executive Officer.
The Board of Directors chooses one of these two forms of General
Management upon the appointment or renewal of the tenure
of the Chairman of the Board or the Chief Executive Officer.
The Board of Directors consistently aims to ensure the ongoing
and continued implementation by the General Management
of the strategic orientations defined by the Board.
To this end, the Board entrusts its Chairman with the task of
developing and maintaining an ongoing, trusting relationship
between the Board of Directors and the Chief Executive Officer.
1.4. Powers of G eneral M anagement
The Chief Executive Officer, who may be the Chairman of the
Board of Directors or another individual, is vested with the
broadest powers to act in all circumstances in the name of the
Company. He must exercise these powers within the limit of the
Company’s purpose subject to the powers expressly granted by
French law to Shareholders’ Meetings and the Board of Directors.
However, transactions which may materially impact the scope
of consolidation of the Company, in particular, transactions
involving an amount in excess of €150,000,000, and all
new transactions which are outside the normal course of
business, must be submitted to the Board. In any event, the
Board of Directors must be informed of the conclusion and
implementation of all transactions.
The Chief Executive Officer represents the Company in its
dealings with third parties.
Upon a proposal by the Chief Executive Officer, the Board of
Directors may appoint one or more individuals responsible for
assisting the Chief Executive Officer, who will hold the corporate
office of Deputy Chief Executive Officer(s).
2. Modus operandi of the Board of Directors
2.1. Convening the Board
The Board is convened by any appropriate means, and may
even be convened verbally. Notices convening a meeting
may be transmitted by the Board Secretary. Except in special
circumstances notices convening a meeting are sent in writing
at least eight days before each meeting. The notices specify
the venue of the meeting, which may be the registered head
office or any other venue.
2.2. Informing Directors
All the documents that are necessary to inform the Directors
about the agenda and about any questions submitted to the
Board for review are enclosed with the notice convening the
meeting or are sent or provided to them within a reasonable
period of time, prior to the meeting.
With regard to the decisions to be taken, the Director must ensure
that he has at his disposal the information he considers essential
for the Board or the Review Committees to carry out their work
satisfactorily. If this is not the case, or if he considers it is not the
case, he must request that the situation is rectified. His requests
should be made to the Chairman of the Board, who is required
to ensure that the Directors are in a position to fulfil their mission.
The Company provides its Directors with useful information at
any time in the life of the Company between Board meetings,
if this is required due to the importance or urgent nature of
the information. This ongoing information process also includes