Stable governance in a swiftly changing cosmetics market - L'Oréal Finance: Annual Report 2018
2018 Annual Report

Stable governance in a swiftly changing cosmetics market

The composition of the Board of Directors reflects L’Oréal’s unique shareholding structure and guarantees the interests of all its shareholders. Alongside the Chairman and Chief Executive Officer, there are three directors from the Bettencourt Meyers family, two directors who represent Nestlé, seven independent directors and two directors representing employees.

Jean-Paul Agon

Chairman and Chief Executive Officer

“L’Oréal’s governance is underpinned by a proactive and committed Board of Directors, which comprises talented members with diverse backgrounds and extensive business experience.”

The diversity and complementarity of the directors’ industrial, financial and entrepreneurial expertise equips them to quickly and thoroughly assess the development challenges facing L’Oréal, the leader of a globalised and highly competitive cosmetics market in which the need to innovate and adapt is crucial. Most of the directors have experience managing international groups at the highest level. In 2018, following the departures of Xavier Fontanet and Charles-Henri Filippi, the Board welcomed two new independent directors: Patrice Caine and Axel Dumas.

At 31 December 2018, Board members represent seven different nationalities and 46% of them are women. Three of the four Committees are chaired by independent female directors.

A Board of Directors that fully assumes its responsibility to provide strategic reflection and impetus

The Board devotes most of its time to strategic issues to foster and accelerate the Group’s transformation into a more universal, more digital and more sustainable L’Oréal. The Board is kept informed throughout the year about the Group’s activities and results, its position in relation to its competitors, market trends and the expectations of consumers all over the world. It examines acquisition projects and monitors the integration of recently acquired companies.
The Board members regularly meet with the senior executives of the Group. This transparent and constructive dialogue culminates in a shared strategic vision, which gives General Management the confidence necessary for its implementation.
A strategic seminar held in Shanghai in June 2018 provided an in-depth understanding not only of the unique characteristics of the Chinese cosmetics market but also of the latest innovations that are revolutionising Beauty.


Proactive and committed directors

The directors are committed and proactive, driven by the conviction that stringent governance creates value for the company. They always keep the company’s long-term interests uppermost in mind as they voice their opinions.
The directors play a tireless and dynamic role in the work of the Board and its Committees, which actively contribute to preparing the Board’s deliberations.
The Board closely monitors changes in best practices and, to ensure that constant progress is achieved, carries out a full review of its modus operandi and organisation every year. It determines which topics to prioritise at this annual review, in order to steer L’Oréal’s long-term strategy.

Ethics at the heart of L’Oréal’s governance and commitments

The Board of Directors places great importance on respecting L’Oréal’s ethical principles – Integrity, Respect, Courage and Transparency – and more generally its Code of Ethics. In 2018, the Senior Vice-President and Chief Ethics Officer presented the ethics policy and the initiatives taken in this field, as well as their results. The Board considers the policy to be an integral part of L’Oréal’s growth model, supports its implementation and regularly measures the progress made.