2022 Universal Registration Document

Chapter 2 : Corporate governance

2.3.5. Self-evaluation by the Board of Directors

Organisation of the annual evaluation of the modus operandi of the Board
September 2022
  • Update of the Thematic interview guide.
  • Update of the Flash questionnaire developed with the help of an external consulting firm.
October 2022

Nominations and Governance Committee (NGC)

  • Validation of the Interview Guide, the Flash Questionnaire and the internal evaluation procedure.
October-November 2022
  • Sending the Flash questionnaire and the Interview Guide to the directors.
  • Individual interviews(Directors / Secretary of the Board).
December 2022

NGC

  • Detailed report of the evaluations.

Board of Directors

  • Summary of the evaluations.
  • 2022 balance sheet.
  • Discussions / wishes for 2023.
  • Decision on internal/external evaluation in 2023.
March 2023
  • Publication of the evaluation summary in the 2022 Universal Registration Document.
  • Annual procedure for the formal evaluation of the Board, carried out within the framework of the AFEP‑MEDEF Code, to which the Company refers, and of market recommendations such as those issued by the AMF.
  • Principal objectives:
    • To confirm that the agendas for Board meetings cover the full scope of the Board’s remit, that important issues have been appropriately prepared and discussed, and that each member’s contribution to the work of the Board has been measured;
    • To formulate suggested improvements;
    • To issue proposals regarding the strategic topics to be examined more thoroughly in 2023.
  • Format and procedure:
    • A thematic interview guide, which was updated in October 2022, sets out the principles stipulated in the AFEP-MEDEF Code and identifies the Board’s practices and market expectations. It enables each Director to ask questions about the operation of the Board and their personal contribution to its work and decisions;
    • A questionnaire was prepared and reviewed in 2022 with the assistance of the consulting firm Spencer Stuart;
    • Individual meetings were held between the Directors and the Secretary of the Board in November and December 2022;
    • Feedback on the responses and interviews was given at the Nominations and Governance Committee meeting of 6 December 2022, then at the Board of Directors meeting of 7 December 2022, followed by discussion between Directors and decisions for 2023.
  • Key themes of the evaluation:
    • The composition of the Board, its organisation and its modus operandi;
    • The quality and relevance of the information provided;
    • The Board’s involvement in defining L’Oréal’s strategy;
    • The activities of the Committees;
    • Key governance issues.
General assessment Areas for improvement/Action to be taken/Issues to be addressed
The composition of the Board The composition of the BoardAreas for improvement/Action to be taken/Issues to be addressed

 
  • Diversity in terms of gender, age, profile and experience.
  • Required expertise to be well represented with regard to the requirements defined by the Board (see section 2.2.1.2.), particularly in terms of the current Chief Executive Officer’s experience of managing major international companies –which brings with it a highly valued entrepreneurial spirit.
  • The international experience of the Directors.
  • Appropriate size for the quality of the work, discussions and decision-making.
  • Appropriate number of independent Directors (50%), given their profile, considerable freedom of expression and the structure of share ownership.
  • Successful onboarding of new Directors with a satisfactory procedures (the transfer of all necessary information documents, meetings with the Board Secretary, and the organisation of interviews with members of the Group’s Executive Committee and the Chief Ethics, Risk and Compliance Officer).
  • Appropriate composition of the Committees, with the appropriate Directors serving on them.
  • Diversity in terms of gender, age, profile and experience.
  • Required expertise to be well represented with regard to the requirements defined by the Board (see section 2.2.1.2.), particularly in terms of the current Chief Executive Officer’s experience of managing major international companies –which brings with it a highly valued entrepreneurial spirit.
  • The international experience of the Directors.
  • Appropriate size for the quality of the work, discussions and decision-making.
  • Appropriate number of independent Directors (50%), given their profile, considerable freedom of expression and the structure of share ownership.
  • Successful onboarding of new Directors with a satisfactory procedures (the transfer of all necessary information documents, meetings with the Board Secretary, and the organisation of interviews with members of the Group’s Executive Committee and the Chief Ethics, Risk and Compliance Officer).
  • Appropriate composition of the Committees, with the appropriate Directors serving on them.
Areas for improvement/Action to be taken/Issues to be addressed
  • When future Directors are recruited, ensuring that this level and this diversity of skills and international experience is maintained.