6.5.1.1 General principles for Corporate Officers’ compensation
The Board of Directors ensures that the compensation policy for Corporate Officers is adapted to the Company’s strategy and operating context and that its purpose is to enhance Sodexo’s medium and long-term performance and competitiveness by attracting and retaining the best talents. The policy is based on the following principles:
| COMPLIANCE |
The compensation policy for the Company’s Corporate Officers is determined in accordance with the recommendations of the AFEP-MEDEF Code. |
|---|---|
| COMPETITIVENESS |
Market studies are regularly conducted – including with the assistance of external consulting firms – in order to benchmark the Company’s compensation packages against its peers (comparable companies in size and geographic scope), to form an overall vision of the challenges surrounding competitive compensation. The Compensation Committee uses two benchmark panels to review and analyze its compensation practices, considering that it is important to examine those of large companies in the French market as well as those of large companies operating in the Company’s sector in international markets. The first panel therefore comprises the companies in the CAC 40 excluding banks and insurance firms. The second panel comprises the following seven companies: Aramark, Compass, Edenred, Elior, ISS, Rentokil and Securitas. |
| COMPLETENESS –BALANCE |
A comprehensive analysis of all of the components of Corporate Officers’ compensation and benefits is conducted using a component-by-component approach. An overall consistency analysis is also performed to ensure that the best balance is achieved between fixed and variable, individual and collective, short and long-term. |
| ALIGNMENT OF INTERESTS |
Aligning interests means both ensuring that the Company has the ability to attract, motivate and retain the talent that it needs, and at the same time, meeting the expectations of the Company’s shareholders and other stakeholders, particularly in terms of Corporate Social Responsibility, transparency, and associating compensation with performance. |
| PERFORMANCE |
The performance conditions applicable to Corporate Officers’ compensation are stringent and are based on the key factors that contribute to the Company's profitable and sustainable growth. They are also in line with the Company’s published targets. Performance is assessed based on three factors, which are set out in the short and long-term variable compensation plans applicable to the Group’s senior executives: (i) core financial performance, (ii) performance relative to Group peers and (iii) sustainable and responsible performance. |
| TRANSPARENCY |
The Corporate Officers’ compensation policy is governed by clear, straightforward and transparent rules. The Compensation Committee ensures that all of these principles are appropriately applied both in the work it performs and the recommendations it issues to the Board of Directors, as much in terms of determining the compensation policy as well as its implementation and the actual amounts of the compensation and benefits. |
6.5.1.2 Shareholder engagement
Sodexo actively engages with its institutional shareholders and proxy advisors via regular meetings held to discuss the specific characteristics of the Group’s governance as well as best practices and developments concerning governance and compensation. During Fiscal 2022, the shareholder engagement was focused on the change in governance with the appointment of Sophie Bellon, first as interim Chief Executive Officer and then as she was confirmed in the role. The meetings with the Group’s largest shareholders, representing approximately 20% of the Group’s capital, were led by Sophie Bellon until March 2022 and then by Luc Messier, as new Lead Director. These messages were relayed more widely by the Investor Relations team.
In addition, the Investor Relations team exchanges frequently with the ESG and proxy analysis teams of institutional shareholders and proxy advisors through individual meetings, governance roadshows and dedicated ESG investor conferences.
Individual shareholders who are members of the Shareholders Club are also invited to share their areas of interest so that the Company can more effectively prepare the Annual Shareholders' Meeting and answer any questions they may have.
Voting results in the fiscal 2021 Annual Shareholders' Meeting were:
- 99.3% of shareholders voted in favor of the last global envelope for directors compensation
- 97.7% of shareholders voted in favor of the Chairwoman’s compensation for Fiscal 2021
- 95.5% of shareholders voted in favor of the Chief Executive Officer’s compensation for Fiscal 2021
- 97.0% of shareholders approved the compensation policy for the Chairwoman for Fiscal 2022
- 93.5% of shareholders approved the compensation policy for the Chief Executive Officer for Fiscal 2022