In accordance with article L. 22-10-12 of the French Commercial Code, the Supervisory Board meeting of September 11, 2019 established, at the behest of the Audit Committee, a procedure for assessing ordinary arm’s length agreements entered into by Publicis Groupe SA.
The procedure for checking the classification and evaluation applies to all new agreements as well as any subsequent amendments (in particular renewal, extension) or when there are certain indications that an agreement or a certain type of agreement no longer fully qualifies as ordinary agreements.
The Legal Department is informed of agreements typically classified as related-party agreements or ordinary agreements at Publicis Groupe SA by the person directly or indirectly concerned who is aware of a draft agreement and, more broadly, by any Groupe body that is aware of a draft agreement.
The ordinary nature and arm’s length terms and conditions of agreements are considered on a case-by-case basis by the Legal Department with the support of the Finance, Accounting, Real Estate and Internal Control Departments with reference to the study published by “Compagnie Nationale des Commissaires aux Comptes” in February 2014 on related-party and ordinary agreements. If, following analysis, it appears that the agreement cannot be classified as an ordinary arm’s length agreement, it will be subject to the procedure for assessing related-party agreements.
Any person directly or indirectly concerned with an ordinary agreement is not involved in its evaluation.
The Audit Committee looks at existing agreements as well as the criteria allowing the classification of ordinary arm’s length agreements. It informs the Supervisory Board of the follow-up and outcomes of this procedure in the meeting on the annual review of the agreements entered into and approved in prior financial years that are still in effect.
The Supervisory Board expresses a view on changes to the procedure it feels are necessary and, on the exclusion, or inclusion of certain agreements in the category of ordinary arm’s length agreements.
The Management Board presented its management report at the Supervisory Board Meeting of February 2, 2022, as well as the annual and consolidated financial statements for 2021. The Supervisory Board examined them, made itself aware of the opinion of the Audit Committee on the closing of the accounts, and had a discussion with the statutory auditors. After having received all the information deemed to be relevant, the Supervisory Board had no comments to make.
The specialized committees set up within the Supervisory Board are as follows:
The detail of the operating conditions for the five Committees is indicated in Title II “Specialized Committees” in the Supervisory Board’s internal rules. This document is available for consultation on the Publicis Groupe website (www.publicisgroupe.com).
Each committee comprises at least three members who must be natural persons, members of the Supervisory Board. The Board appoints the members of the committees. The members of the committees are appointed for the duration of their term on the Supervisory Board and may be reelected in the same manner, pursuant to article 13 of the bylaws. Each member is chosen on the basis of his or her skills and expertise in the Committee’s area of work. The Board appoints a Chair for each Committee chosen from among its members, whose role is to direct the work of the Committee and report on it to the Supervisory Board. The committees may appoint an external expert, either temporarily or on a permanent basis, whose compensation will be determined by the committee in question.
The five specialized committees assist the Supervisory Board in the performance of its duties and thus contribute to the improvement of corporate governance within the Groupe. The committees, each in its own area of expertise, prepare the work of the Supervisory Board and issue recommendations and opinions to help the Board make decisions.
