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REPORT OF THE CHAIRMAN OF THE BOARD OF DIRECTORS
A1
4. System of internal controls
Pursuant to the initiative launched at the end of 2015 by the Chief Executive
Officer and with the full support of its governance bodies, the group continued
to deploy a program to strengthen compliance and ethics. This initiative, the
first phase of which is expected to last 18 months, is the expression of AREVA’s
determination to rise quickly to the level of the best references in this field. Within
this framework, the warning system was strengthened starting at the end of 2015
and an “individual compliance commitment letter” process was instituted for all of
the group’s executives.
To improve existing systems, the Director of Compliance published a Code of Ethics
in 2016 to replace the old Values Charter and a Compliance Policy governing
its implementation. He also put in place an anti-corruption compliance policy, a
competition legislation and regulation compliance policy, a financial compliance
and ethics policy, and an insider trading rules compliance policy.
In addition, the discovery of anomalies at the Creusot site in 2015 and 2016 was
factored into the strengthening of the compliance and ethics program and taken
into account for the continuous improvement of the internal control system.
4.1.2.
INTERNAL CONTROL STANDARDS
In the “Frame of Reference for Internal Control” of the Autorité desmarches financiers
(AMF), to which the group defers, the internal control system is characterized by:
p
an organization with a clear definition of responsibilities, sufficient resources and
expertise, and appropriate information systems, procedures, tools and practices;
p
the internal dissemination of relevant and reliable information enabling each
person to discharge his or her responsibilities;
p
a system to identify, analyze and manage risk;
p
control activities designed to reduce this risk; and
p
continuous monitoring of the internal control system.
The group ensured that the approach taken is consistent with the standards of the
AMF. In particular, it verified the consistency between:
p
the “Implementing guidelines for the internal control of accounting and financial
information published by the issuers” included in the Frame of Reference, and
p
the system for self-audit of internal controls within the group (Self Audit Income),
which was carried out to ensure that all the standards are met (see Section 4.6,
Continuous oversight of the internal control system
).
4.1.3.
INTERNAL CONTROL OBJECTIVES
Internal controls contribute to themanagement of operations. They aim in particular
to ensure:
p
compliance with laws and regulations;
p
implementation of instructions and guidelines set by the governing bodies;
p
the smooth functioning of the group’s internal processes, in particular those
contributing to the preservation of its assets;
p
the reliability and quality of the information produced and communicated, with
particular emphasis on financial information.
The scope of internal control is not limited to procedures for ensuring the reliability
of accounting and financial information.
However, no matter how well designed and implemented, internal control
mechanisms are not sufficient by themselves to guarantee with absolute certainty
that these objectives are met.
AREVA’s internal control system is consistent with the group’s commitments
regarding the conduct of its operations, particularly in the framework of its Code
of Ethics.
4.2.
ORGANIZATION, GOVERNANCE, RESOURCES, INFORMATION SYSTEMS
AND OPERATING PROCEDURES
Internal controls are implemented throughout the group by all employees under
the overall responsibility of existing governing bodies.
4.2.1.
AREVA’S ORGANIZATION
AREVA has a single corporate governance body, the Board of Directors.
In this framework, and as described in Section 3 of this report, the Board of Directors
is in charge in particular of defining the group’s strategy and validating large
capital expenditures and sensitive or significant commercial proposals, drawing
in particular on preparatory work carried out by the four standing committees it
has created and by the Ad Hoc Committee and the AREVA TA Working Group
which it created on a temporary basis (to deal with conflict of interest matters) (see
Section 3.5.
Committees of the Board of Directors
).
The Chief Executive Officer is responsible for the company’s executivemanagement
and represents the company in its relations with third parties. In addition to the
powers conferred on him by law, and subject to the limitations set forth in the
Articles of Association or in the Board of Directors’ Rules of Procedure, the Chief
Executive Officer is responsible for:
p
defining the group’s performance objectives (financial, commercial, operational,
nuclear safety, occupational safety, etc.) and their breakdown by business, and
monitoring their achievement;
p
allocating the group’s resources (human resources, financial resources, etc.);
p
defining organizational principles and processes to serve customers and build
talent.
Although the methods of control by the Board of Directors and its specialized
committees were not modified in 2016, the AREVA group nonetheless changed
the methods of internal line management of its operations as the milestones of
the Restructuring Plan rolled out by the company were met. The Restructuring
Plan is part of a broader framework for the redefinition of the respective roles and
responsibilities of French nuclear industry players decided in June 2015.
326
2016 AREVA
REFERENCE DOCUMENT