Audit and risks committee
Since April 23, 2020, the Audit and risks committee has four members: Ms. Cécile Cabanis, Chairperson, Mr. Willy Kissling, Ms. Jill Lee and Ms. Fleur Pellerin. Three out of four members, including its Chair, are independent, i.e. 75%. Mr. Pierre Lévêque, Director of Internal Audit, is the secretary of the Audit and risks committee.
The committee meets at the initiative of its Chairperson or at the request of the Chairman and CEO. At least five meetings are held during the year.
The committee may invite any person it wishes to hear to its meetings. The statutory auditors attend meetings at which financial statements are reviewed and, depending on the agenda, all or some of the other meetings. It may also require the CEO to provide any documents it deems to be useful. It may also commission studies from external consultants.
A cornerstone of the Group’s internal control system, the Audit and risks committee is responsible for preparing the work of the Board of directors, making recommendations to the Board and issuing opinions on financial, extra-financial, accounting and risk management issues. Accordingly, it:
- prepares for the annual and interim financial statements to be approved by the Board and, more particularly:
- checks the relevancy and consistency of the accounting methods used for drawing up consolidated and corporate accounts, as well as checking that significant transactions at the Group level have been dealt with appropriately and that rules relating to the scope of consolidation have been complied with,
- analyses the scope of consolidation, risks, including those of a social and environmental nature, and off-balance sheet commitments as well as the financial position and the cash position,
- examines the process for drawing up financial and extra-financial information;
- reviews the draft annual report, which is also the registration document which contains information on internal control, and receives comments from the AMF thereon, if any; also reviews the draft reports on the interim financial statements and other main financial documents;
- makes recommendations concerning the appointment or re-appointment of the statutory auditors;
- handles follow-up on legal control of annual and consolidated accounts made by statutory auditors, including by examining the external audit plan and results of controls made by statutory auditors;
- verifies the auditors’ independence, in particular by reviewing fees paid by the Group to their firm and network and by giving prior approval for assignments that, strictly speaking, fall outside the scope of the auditing of the financial statements;
- monitors the efficiency of internal control and risk management systems. For this purpose, it:
- reviews the organization and resources used for internal audit, as well as its annual work schedule, and receives a quarterly summary report on the findings of the audits carried out,
- reviews the mapping of risks related to the company’s business and its year-on-year evolution, and ensures procedures are implemented to prevent and reduce them,
- reviews risk mitigation and coverage optimization,
- reviews the rollout of the Group’s internal control system and acknowledges the outcome of entities’ self-assessment regarding internal control. It ensures procedures are implemented to identify and handle anomalies,
- ascertains the existence of Group compliance policies notably concerning competition, anti-bribery, ethics and data protection and the measures implemented to ensure that these policies are circulated and applied.
The Audit and risks committee examines proposals for distribution as well as the amount of financial authorizations submitted for approval at Annual Shareholders’ Meetings.
The Audit and risks committee reviews all financial and accounting issues and those related to risk management submitted to it by the Board of directors.
The Audit and risks committee presents the findings of its works and how they contribute to the integrity of the financial and extra-financial information. It informs the Board of the follow-up actions that it proposes to take. The Chairperson of the Audit committee keeps the Chairman and the Vice-chairman independent lead director promptly informed of any difficulties encountered.