Fiscal 2021 Universal Registration Document

ASSESSMENT OF THE BOARD’S OPERATING PROCEDURES

At least once a year, the Board of Directors devotes an agenda item to discussing its operating procedures, and every three years it organizes a formal external assessment.

The most recent formal assessment was carried out in 2020, and its findings were presented and discussed at the Board meeting in June 2020. The assessment was performed by an external consulting firm and consisted of a questionnaire and individual meetings with all Board members. As well as appraising each director’s actual contribution to the Board’s work, the following six topics were covered in the assessment:

• the composition of the Board of Directors;
• the allocation of roles and Board dynamics;
• discussions on strategy;
• discussions on performance;
• logistics and administrative performance; and
• the Board’s Committees.

The Board’s membership structure has recently been strengthened with the arrival of new independent directors with solid competencies in finance, human resources and operations, and the overall age profile is gradually getting younger. Similarly, there has been a renewal of skills within the Board Committees.

In terms of the allocation of roles and Board dynamics, the general view of the Board’s operating procedures is favorable and the directors particularly appreciate their freedom of expression and the Board’s spirit of collective intelligence. They also consider that Board meetings are highly participative. The directors representing employees consider that they are fully integrated into the Board and that their contribution is valued.

Concerning strategy, the strategy days organized by Sodexo are very much appreciated and reinforce the choice to involve the whole Board in strategy decisions rather than creating a dedicated Strategy Committee.

Similarly, Corporate Social Responsibility issues are addressed directly by the Board as a whole instead of by a dedicated Committee. In addition to the yearly overall presentation, these issues are systematically raised when discussing other items on the Board’s agenda.

The directors feel that they have a good understanding of the Group’s operational challenges and goals, a good risk map, and detailed performance monitoring that provides information that is both accessible and high quality.

The Committees’ roles and responsibilities are clear and appropriate. The quality of the work of the Nominating and Compensation Committees has improved since the last formal assessment.

In terms of Board’s composition, identified areas for improvement included adding international profiles and CEOs with in-depth business transition/transformation experience, including in digital, increasing the representation of the service sector on the Board.

A discussion on the operating procedures of the Board and its Committees took place at the Board meeting held in June 2021.

Specialized Committees of the Board

To support its decision-making process, the Board of Directors has three specialized Committees, each with its own charter approved by the Board of Directors setting out its role, responsibilities and operating procedures.

Broadly, the role of these specialized Committees is to examine specific issues ahead of Board meetings and to submit opinions, proposals and recommendations to the Board of Directors.

AUDIT COMMITTEE

COMPOSITION AS OF AUGUST 31, 2021

(1) Deemed a “financial expert” as defined in article L.823-19 of the French Commercial Code.
(2) On October 28, 2020, Véronique Laury succeeded Soumitra Dutta as a member of the Audit Committee.

* Excluding directors representing employees.

All Audit Committee members have recognized competencies in finance and accounting, as confirmed by their professional background (see section 6.2.1.3). When Cathy Martin was appointed as a member of the Audit Committee, she was given specific in-house training on the Company’s accounting, financial and operating procedures.

The Audit Committee is responsible for ensuring that the Group’s accounting policies are appropriate and consistently applied, particularly with respect to material transactions. It also verifies that the procedures used for preparing and processing accounting information (both financial and extra-financial) are effective and it issues recommendations for ensuring the integrity of such information.

It examines the Company’s fraud detection procedures and its whistleblowing system. It is notably in charge of ensuring that a procedure is in place for dealing with complaints from third parties or employees (which may be anonymous) about any irregularities concerning accounting or internal control practices or any other area.