Fiscal 2021 Universal Registration Document

5.4.2 Statutory Auditor's special report on related-party agreements

This is a free translation into English of the Statutory Auditors’ special report on related-party agreements issued in French and is provided solely for the convenience of English speaking readers. This report should be read in conjunction with, and construed in accordance with, French law and professional auditing standards applicable in France.

Shareholders Meeting held to approve the financial statements for the year ended August 31, 2021)

SODEXO

255 Quai de la Bataille de Stalingrad
92866 Issy Les Moulineaux Cedex 9

To the shareholders,

In our capacity as Statutory Auditors of Sodexo, we hereby report to you on related-party agreements.

It is our responsibility to report to shareholders, based on the information provided to us, on the main terms and conditions of agreements that have been disclosed to us or that we may have identified as part of our engagement, as well as the reasons given as to why they are beneficial for the Company, without commenting on their relevance or substance or identifying any undisclosed agreements. Under the provisions of article R. 225-31 of the French Commercial Code (Code de commerce), it is the responsibility of the shareholders to determine whether the agreements are appropriate and should be approved.

Where applicable, it is also our responsibility to provide shareholders with the information required by article R.225-31 of the French Commercial Code in relation to the implementation during the year of agreements already approved by the Shareholders Meeting.

We performed the procedures that we deemed necessary in accordance with professional standards applicable in France to such engagements. These procedures consisted in verifying that the information given to us is consistent with the underlying documents.

Agreements to be submitted for the approval of the Shareholders Meeting

Agreements authorized during the year

In accordance with article L.225-38 of the French Commercial Code, we were informed of the following agreements entered into since the year-end, which were previously authorized by the Board of Directors during the year.

SERVICE AGREEMENT BETWEEN BELLON SA AND SODEXO

• Persons concerned: Sophie Bellon, Nathalie Bellon-Szabo and François-Xavier Bellon, members of the Board of Directors of Sodexo and members of the Management Board of Bellon SA.
• Nature and purpose: At its meeting on June 23, 2021, the Board of Directors, on the recommendation of the Audit Committee, authorized the conclusion of a new service agreement, renewing under similar conditions the agreement previously entered into with effect from November 17, 2016 and expiring on November 17, 2021. The new agreement was entered into on October 26, 2021 and comes into effect on November 17, 2021 for a period of five (5) years. Under this agreement, Bellon SA provides Sodexo with three of its employees to hold the positions of Group Chief Financial Officer, Group Chief People Officer and Group Chief Growth Officer, enabling Sodexo to benefit from their experience and skills in the implementation of its strategy.
• Terms and conditions: Under this agreement, Bellon SA invoices Sodexo for the compensation of the Group Chief Financial Officer, Group Chief People Officer and Group Chief Growth Officer during the secondment period. This invoicing includes the compensation and associated benefits, as well as payroll and any other related taxes. The invoiced amount does not include a margin on the items invoiced. The total fees billed under this agreement, and changes compared with the prior year, are reviewed annually by the Audit Committee. In addition, and in compliance with the law, the agreement is reviewed every year by the Board of Directors. The annual fees payable to Bellon SA are approved each year by the Board of Directors of Sodexo, with none of the directors who are Bellon family members taking part in the vote.
• Reasons given as to why the agreement is beneficial for the Company: The Board of Directors of Sodexo authorized this agreement for the following reasons: “The Board of Directors deemed that this agreement was in line with the interests of all shareholders given:
  • the strategic advantage for Sodexo of having a business model based on the values of family shareholdings;
  • the quality of the managers concerned;
  • all the governance processes that guarantee a good balance of powers and avoid any abusive control;
  • the absence of economic impact for the Company.

The agreement ensures that the values, culture and ambitions initially set out by Pierre Bellon are shared at all levels of the Group. Since Sodexo was founded over 50 years ago, Pierre Bellon’s ambition is for Sodexo to be a community of customers, consumers, employees and shareholders. This concept, which was a precursor to the current rise in social and environmental awareness, is one of the fundamental principles of Sodexo’s development and guarantees a business model that creates value for all stakeholders.

With these three key managers promoting this model, Sodexo ensures its application through the implementation of the Group’s strategy.