Activities of the Board and its Committees in 2022

The Board of Directors fully assumes its role in defining the Group’s strategic orientations.

Thanks to an open and constructive dialogue with the General Management and regular meetings with management, the Directors are completely up-to-date with L’Oréal’s economic reality and fully informed of all the Company’s activities, its performances and the challenges it faces. They examine the main areas and opportunities for long-term development and acquisitions in particular.

The Directors make sure that the decisions taken contribute to implementation of the strategy.

Wishing to continually enhance its role to reflect on issues and drive strategic decision-making, in 2022, the Board carried out an evaluation of its modus operandi and organisation, as it has done every year since 1996 (see section 2.3.5.).

BOARD OF DIRECTORS
7 meetings in 2022 – 97.5% attendance rate
MAIN WORK IN 2022
  • Corporate governance:
    • Changes in the composition of the Board and Committees, preparation of draft resolutions on the renewal of terms of office ;
    • Information on the expectations of investors and proxy advisors ;
    • Extension of the separation of the offices of Chairman and Chief Executive Officer ;
    • Evaluation of the modus operandi of the Board and executive session.
  • Remuneration policy, Human Resources, gender balance within the management bodies: discussion of the remuneration policy for directors and corporate officers for 2022 ; determination of the remuneration for directors and corporate officers for 2021 and evaluation of the performance of the Chief Executive Officer ; determination of the performance share award plan of 13 October 2022 and the third worldwide shareholding plan ;information and discussion of the Group’s Human Resources policy, including the remuneration policy, diversity and gender balance policy, and the L’Oréal for Youth programme.
  • Business activity and results: definition of the strategic orientations, taking into account social and environmental challenges; systematic review of the Group’s results and analysis of changes in the cosmetics market.
  • Information on the consequences of the Covid-19 health crisis and the war in Ukraine.
  • Strategic themes reviewed in 2022: Cyber security, CSR, Ethics policy, Operations, China, Digital and e-commerce activities.
  • Strategic seminar held in June 2022: Research & Innovation (Beauty Tech and Green Sciences) ; Risk mapping ; Indies Brands.
  • Training of the Board on CSR issues in October 2022 with internal and external stakeholders.
STRATEGY AND SUSTAINABILITY COMMITTEE AUDIT COMMITTEE NOMINATIONS AND GOVERNANCE COMMITTEE HUMAN RESOURCES AND REMUNERATION COMMITTEE
6 meetings – 100% attendance rate 5 meetings – 93.5% attendance rate 4 meetings – 100% attendance rate 4 meetings – 91.5% attendance rate
2022 MAIN ACTIVITIES 2022 MAIN ACTIVITIES 2022 MAIN ACTIVITIES 2022 MAIN ACTIVITIES
  • Health and geopolitical situation: regular report on the consequences of Covid-19 and the situation in Ukraine
  • Strategy:
    • Analysis of sales, update on business activities, market trends and competition, analysis of the performance of the latest product launches.
    • Review of proposed acquisitions and partnership projects.
    • Review of the Ambition France project (change in the scope of L’Oréal S.A.).
    • Review of the Group’s strategic development prospects.
  • Sustainable development:
    • Review of recent initiatives (L’Oréal for the Future programme).
    • Review of the proposed credit line subject to ESG criteria and bond issues linked to sustainable development goals.
  • Health and geopolitical situation: regular report on the consequences of Covid-19 and the situation in Ukraine
  • Strategy:
    • Analysis of sales, update on business activities, market trends and competition, analysis of the performance of the latest product launches.
    • Review of proposed acquisitions and partnership projects.
    • Review of the Ambition France project (change in the scope of L’Oréal S.A.).
    • Review of the Group’s strategic development prospects.
  • Sustainable development:
    • Review of recent initiatives (L’Oréal for the Future programme).
    • Review of the proposed credit line subject to ESG criteria and bond issues linked to sustainable development goals.
AUDIT COMMITTEE
  • Monitoring the process for preparation of financial information: Review of annual and interim results, analysis of operating income by Division and Zone. Review of Statutory Auditors’ Reports. Review of the Statutory Auditors’ audit plan for 2022. Treasury and financing.
  • Internal Control, Risks and Compliance:
    • Review of the internal control systems implemented.
    • Monitoring Internal Audit activities, including CSR and cyber security.
    • Risk mapping.
    • Reports on data privacy, insurance, fraud risk, digital risks and challenges.
  • Monitoring the process for preparation of non‑financial information and non-financial risks:
    • Duty of vigilance: focus on Human Rights.
    • Examination of climate risks in 2022.
    • Draft double materiality matrix.
  • Health and geopolitical situation: regular report on the consequences of Covid-19 and the situation in Ukraine
  • Strategy:
    • Analysis of sales, update on business activities, market trends and competition, analysis of the performance of the latest product launches.
    • Review of proposed acquisitions and partnership projects.
    • Review of the Ambition France project (change in the scope of L’Oréal S.A.).
    • Review of the Group’s strategic development prospects.
  • Sustainable development:
    • Review of recent initiatives (L’Oréal for the Future programme).
    • Review of the proposed credit line subject to ESG criteria and bond issues linked to sustainable development goals.
NOMINATIONS AND GOVERNANCE COMMITTEE
  • Composition of the Board:
    • Reflection on the composition of the Board and its Committees.
    • Arrangements for renewing the terms of office of the two Directors representing the employees, their onboarding and training.
  • Governance:
    • Analysis of 2022 voting policies for investors and proxy advisors.
    • L’Oréal guide for new Directors representing the employees.
    • Review of the independence of Directors.
    • Review of the results of the Board’s self-assessment.
    • Values Committee: 2022 review.
  • Succession plans and emergency plans: annual review.
  • Regulatory updates and knowledge of market practices and expectations: Draft European Directive on duty of vigilance/sustainability and regulatory developments ; Update of the AFEP‑MEDEF Code Application Guide (March 2022). Government report on Directors representing employees and AMF and HCGE reports for 2022.
  • Health and geopolitical situation: regular report on the consequences of Covid-19 and the situation in Ukraine
  • Strategy:
    • Analysis of sales, update on business activities, market trends and competition, analysis of the performance of the latest product launches.
    • Review of proposed acquisitions and partnership projects.
    • Review of the Ambition France project (change in the scope of L’Oréal S.A.).
    • Review of the Group’s strategic development prospects.
  • Sustainable development:
    • Review of recent initiatives (L’Oréal for the Future programme).
    • Review of the proposed credit line subject to ESG criteria and bond issues linked to sustainable development goals.
HUMAN RESOURCES AND REMUNERATION COMMITTEE
  • Remuneration of corporate officers:
    • Analysis of the voting policies of investors and proxy advisors concerning remuneration.
    • Remuneration of corporate officers for 2021 and 2022 : analysis of 2021 performance, setting objectives and weightings for 2022 for the Chief Executive Officer.
    • Recommendations on corporate officer remuneration policies for 2023.
    • Say on Pay : draft resolutions.
    • Remuneration ratios.
  • Remuneration of Directors: Breakdown for 2022 and proposed changes for 2023.
  • Annual review of ongoing regulated agreements
  • Human Resources policy: Group remuneration policy, disability policy, policy on diversity and equality in management bodies.
  • Long-term incentives policy:
    • Recording of performance relating to the ACAs Plan of 2018.
    • Draft resolution for the 2022 AGM, proposing the inclusion of non‑financial criteria.
    • Preparation of the 2022 ACAs Plan.

398 pages

www.publispeak.com