LOREAL_Registration_Document_2017

2 Corporate governance *

ORGANISATION AND MODUS OPERANDI OF THE BOARD OF DIRECTORS

Annual evaluation of the modus

4.5.

the committee may deliberate on this work and in turn report thereon to the Board. For each Committee meeting, its members may decide to invite any other person of their choice to attend as needs be and on an advisory basis, when they consider it appropriate. In its field of competence, each committee makes proposals and recommendations and expresses opinions as the case may be. For this purpose, it may carry out or have carried out any studies that may assist in the deliberations by the Board. When they use the services of external consultants, the committees must ensure that their service is objective. Remit 5.1.1. The remit of the Strategy and Sustainable Development Committee is to throw light, through its analyses and debates, on the Group’s strategic orientations as submitted to the Board of Directors and to monitor the implementation and advancement of significant operations in progress. The committee examines: the main strategic lines of development, options and projects s presented by the General Management, and their economic, financial, societal and environmental consequences; opportunities for acquisitions or investments which s involve significant amounts or which represent a departure from the Group’s usual business operations, and the conditions relating to their implementation; financial transactions liable to significantly change the s balance sheet structure; the Company’s commitments with regard to Sustainable s Development, in light of the issues specific to the Group’s business activities and its objectives, and the means and resources put in place; the proposed strategic orientations to be defined by the s Board with a view to consultation of the Central Works Council. More generally, the committee debates all questions considered essential for the future strategy of the Group and for preserving its main financial balances. Work organisation 5.1.2. It meets when convened by the Chairman/Chairwoman of the committee whenever he/she or the Board considers this appropriate. The agenda of the meetings is set by the Chairman/ Chairwoman of the committee, in conjunction with the Board of Directors if the Board initiates the meeting. The Strategy and Sustainable Development Committee reports on its work to the Board whenever necessary, and at least once a year. Strategy and Sustainable Development Committee 5.1.

operandi of the Board Every year, the Board carries out an evaluation of its ability to respond to the expectations of the shareholders by reviewing its composition, its organisation and its modus operandi . At its last meeting for the year and on the basis of a summary of the interviews that are previously organised and conducted with each Director, on the basis of a guide which includes the recommendations adopted by the AFEP-MEDEF Code, the Board discusses points of view and opinions expressed. It draws the conclusions from this with the aim of improving the conditions for the preparation and organisation of its work and that of its committees. The results of the evaluation, with the avenues of progress that remain open, are passed on to the shareholders in the Annual Report and at the time of the General Shareholders’ Meeting. When the Board sets up committees, it appoints the members of these committees and determines their duties and responsibilities. These committees act within the remit granted to them by the Board and therefore have no decision-making power. The committees may not at any time take over the powers of the General Management as set out in chapter 1.2.2. of these Rules. The committee members are Directors. They are appointed by the Board in person and may not be represented. All Board members have the necessary qualifications due to their professional experience. They actively take part in Committee meetings with complete freedom of judgement and in the interest of the Company. The task of secretary of each committee is carried out by a person appointed in agreement with the Chairman/Chairwoman of the committee. It may also be performed by the Secretary of the Board. Each committee defines the frequency of its meetings. These meetings are held at the Company’s registered head office or at any other place decided by the Chairman/Chairwoman of the committee. The Chairman/Chairwoman of each committee prepares the agenda for each meeting. The committees may make contact, in the performance of their duties, with the Company’s main senior managers, in agreement with the Chairman of the Board and after informing the General Management and will report on such contacts to the Board. The Board may entrust a committee Chairman/ Chairwoman, or one or more of its members, with a special assignment or project to carry out specific research or study future possibilities. The designated individual will report on this work to the committee concerned such that BOARD COMMITTEES 5.

REGISTRATION DOCUMENT / L'ORÉAL 2017

80