Mainly controlled by Crédit Agricole's Regional Banks, Crédit Agricole S.A. defines its own model of governance by being inspired at the same time by the inheritance of the mutualist values of group companies and by rules applied by the big listed European companies.
The governance of Crédit Agricole S.A. so leans on the values of transparency, responsibility and efficiency, what is translated in the organization and the functioning of the Board of Directors by:
- The very active implication of the directors in the corporate life of the company, as well as in the control of its management and its strategy;
- The will to search for the opening and for the balance in the organization of the powers and the composition of governing bodies;
- The permanent concern to allow each to exercise effectively the responsibilities with the necessary objectivity and the independence, in particular through the quality of the dialogue and the transparency of the information.
Activity of the Board of Directors during year 2014
The Board was very active in 2014 (meeting seven times, including one extraordinary meeting) and the attendance rate remained very high, averaging 99% (99% for the scheduled meetings and 100% for the extraordinary meeting), reflecting the strong commitment of all Directors.
Following a year in 2013 that was marked by the drafting of the 2014-2016 Medium Term Plan for Crédit Agricole Group (MTP) and the implementation of measures taken to adjust Crédit Agricole S.A. Group to its economic, financial and regulatory environment, 2014 was marked by:
- the finalisation of the MTP, approved by the Board at its extraordinary meeting of 18 March 2014, after analysis of its financial element by the Strategy Committee and the Audit and Risks Committee; the plan was then presented to the market; the arrangements for monitoring plan execution were also defined under the auspices of the Strategy Committee;
- the Asset Quality Review (AQR) and the subsequent stress tests conducted by the European Central Bank; the results of these, to which the Audit and Risks Committee devoted much of its time in 2014, were presented to the Board in November 2014. At the same meeting, a presentation of the new Single Supervisory Mechanism for monitoring credit institutions by the European regulator was made to the Board;
- the definition, under the auspices of the Appointments and Governance Committee in accordance with the recommendations of the AFEP/MEDEF Code, of the principles governing the succession of Executive Corporate Officers of the Company. These principles, approved by the Board at its meeting of 18 February 2014, came into play at the end of the year, with the initiation of the selection process for the future Chief Executive Officer of Crédit Agricole S.A., as Mr Jean-Paul Chifflet, the current Chief Executive Officer will stand down from his duties at the end of the General Meeting of Shareholders of 20 May 2015. At its meeting of 16 December 2014, the Board instructed the Appointments and Governance Committee to manage this process, which had not been completed as of the date of drafting of this report;
- an assessment, carried out under the auspices of the Appointments and Governance Committee, of the Board of Directors’ operations, with the help of an external consultant. The results of this assessment carried out in the summer of 2014, were presented and discussed at the Board meeting of 16 December. The areas for improvement highlighted by the assessment mainly relate to: the interaction between the Board and the Strategy Committee; the introduction, in addition to financial information, of information on the competitive environment and the Group’s positioning, in particular when presenting the results; the training of Directors. On the recommendation of the Appointments and Governance Committee, the Board approved an action plan to improve its operations and to respond to the wishes expressed by the Directors. This plan is structured around four themes:
- more in-depth debate within the Board, including in particular the organisation of an annual seminar on strategy,
- training and informing Directors: strengthening the integration of Directors and new members of Specialised Committees and identifying individual training needs; setting up training modules on technical and/or regulatory topics, similar to the processes set up in 2013 for members of the Audit and Risks Committee and in 2014 for new members of the Compensation Committee; regular presentations to the Board on market developments and the Group’s competitive positioning,
- governance: incorporating new obligations resulting from the CRD 4 directive within the Board’s operations and of its Specialised Committees,
- organising the work and operations of the Board: more didactic presentations, more balanced agenda planning.
In terms of governance, in addition to the assessment of the Board of Directors and the appointment of two new Directors, the year was marked by the analysis of draft legislation to transpose the CRD 4 directive. This analysis was presented to the Compensation Committee in July and November 2014, for provisions relating to compensation, and to the Appointments and Governance Committee in October 2014, for governance aspects. The new provisions introduced by the decree of 3 November 2014 will be implemented in 2015, under the auspices of the Appointments and Governance Committee, including in particular, defining a methodology for annual assessment of the Board’s performance and updating the Rules of Procedure of the Board and the Specialised Committees.
In addition, the Board has examined the Corporate Social Responsibility ( CSR ) Report for Crédit Agricole S.A. Crédit Agricole S.A.’s track record in CSR is illustrated by the synthetic index “FReD” (Fides, Respect & Demeter), introduced on 1 January 2012 for Crédit Agricole S.A. and its main subsidiaries. A specific report on the Group’s corporate social responsibility has been drawn up since 2013 and is available on the Company’s website. The CSR strategy implemented in conjunction with the Regional Banks and the Fédération Nationale du Crédit Agricole, in accordance with Crédit Agricole Group’s Medium Term Plan, is also reflected in the introduction of responsible offerings At its meeting of 17 February 2015, the Board decided to include corporate social responsibility in the duties of the Strategy Committee, thus signalling its intention to incorporate this dimension in Crédit Agricole Group strategy. This Committee has now been renamed the Strategy and Corporate Social Responsibility Committee.