The Board’s membership structure continued to be strengthened with the arrival of new independent directors with solid competencies in finance, purchasing and operations. Similarly, there has been a renewal of skills within the Board Committees.
A new internal assessment of the work of the Board of Directors was carried out in 2024. Organized by the Lead Director, assisted by both the Chairman of the Nominating Committee and the secretary to the Board, the assessment focused on the follow-up to the roadmap that had emerged from the previous assessments, in particular concerning the composition of the Board of Directors, its operation, strategy and performance, as well as the induction process of new directors and succession plans. The report on this internal assessment will be presented to the Board of Directors during Fiscal 2025.
Specialized Committees
To support its decision-making process, the Board of Directors has created four specialized Committees: the Audit Committee, the Nominating Committee, the Compensation Committee and the Sustainability Committee (set up on June 27, 2024). The creation of this fourth specialized Committee is the result of the benchmarking and reflection work launched during Fiscal 2023 concerning the treatment of social and environmental responsibility issues within a Committee and no longer solely at the level of the Board of Directors as a whole. The creation of this Committee is also aimed at implementing the CSRD Directive by Fiscal 2025. The role of the Sustainability Committee is to examine the Group’s strategy, ambitions and commitments in terms of sustainability (ethics and compliance, human rights, health and safety at work, and the environment). Its first meeting took place in October 2024.
Each of these Committees has a charter, approved by the Board of Directors, setting out their roles and operating procedures. These charters are reviewed on a regular basis.
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, 2024 | |
|---|---|
| Jean-Baptiste Chasseloup de Chatillon(1) | Chairman, independent director |
| François-Xavier Bellon | Director |
| Véronique Laury | Independent director |
| Cathy Martin | Director representing employees |
| Luc Messier | Lead independent director |
(1) Deemed a “financial expert” within the meaning of article L.823-19 of the French Commercial Code.
75%independent directors*
100%attendance rate
6meetings
* Excluding directors representing employees.
All Audit Committee members have recognized competencies in finance and accounting, as confirmed by their professional background (see section 7.2.1.2). Jean-Baptiste Chasseloup de Chatillon is deemed a financial expert within the meaning of article L.823-19 of the French Commercial Code, due to both his initial training and the finance management positions he has held in a number of leading international groups. 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, financial and sustainability-related information 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.
It issues observations and recommendations to the Company’s senior management team about risks, particularly the structure, scope and organization of risk management. Accordingly, it periodically reviews senior Management Reports on risk exposure including (and, where appropriate, in coordination with the Sustainability Committee) sustainability impacts, risks and opportunities (IROs), as well as prevention and ensures that effective internal controls are applied. It also regularly reviews the internal audit reports and is informed of the internal audit plan. In cooperation with the Sustainability Committee, it examines the double materiality assessment and, where necessary, makes recommendations to ensure its integrity.
The Audit Committee performs an annual review of the fees paid to the Statutory Auditors of Sodexo and its subsidiaries, assesses auditor independence and pre-approves certain non-audit services. When necessary, it carries out the process for appointing and reappointing the Statutory Auditors responsible for certifying the accounts, and with the Statutory Auditor(s) (or, where applicable, the independent third-party organization(s) or "ITO(s)" responsible for certifying sustainability information.
The Audit Committee also issues recommendations to the Board of Directors about the regular assessment of the conditions for entering into related-party agreements and other agreements within the Group. As part of its work in this area, it reviews the annual payment due under the service agreement signed between Sodexo and Bellon SA (described in section 7.2.2 of this Universal Registration Document), as well as any changes in its amount from one year to the next.
Lastly, the Audit Committee reviews and issues recommendations on requests made to the Board for guarantees.
To perform its role, the Audit Committee is assisted by the Chief Executive Officer, the Chief Financial Officer, the Senior Vice President Group Internal Audit, the Group Internal Control Director and the Statutory Auditors, who present their work to the Committee and answer any questions that it may have. The Committee may also make inquiries of any Group employee, without any Company executives being present, and seek advice from outside experts. It meets at least once a year with the Statutory Auditors without the management.
The Audit Committee met six times in Fiscal 2024 and the attendance rate was 100%.
In addition to the above matters, the Committee’s work during the year concerned the following:
- reviewing the internal control process;
- reviewing the risk matrix (including social and environmental risks), the audit plan and monitoring audit engagements;
- presenting off-balance sheet commitments;
- reviewing the Fiscal 2024 audit plan;
- reviewing the Audit Committee’s charter;
- monitoring the Group’s cash position and financing;
- monitoring the guarantees issued by the Company and the related authorizations granted to the Chairwoman and CEO by the Board of Directors, and, more generally, monitoring the Group’s off balance-sheet commitments;
- reviewing the non-audit services performed by the Statutory Auditors;
- reviewing the amount paid to Bellon SA under the service agreement with the Company;
- changing the name of the signing partner of KPMG, Statutory Auditor;
- litigation review;
- reviewing the financial information systems;
- the proposed Pluxee spin-off;
- the Group’s financing;
- the presentation on non-financial reporting obligations and a progress report on the implementation of the CSRD Directive, in particular on planning, double materiality and the future appointment of auditors responsible for certifying sustainability information;
- protection of personal data, by obtaining Binding Corporate Rules certification;
- customer retention and loyalty;
- cybersecurity;
- the ERP program;
- taxation;
- competitor benchmark.