Les Echos
- Training, diversification, feminisation, evaluation: these bodies are becoming more professional.
- But much remains to be done, according to an exclusive study by Russell Reynolds Associates.
Governance
Marion Kindermans, with M. J.
"Fifteen years ago, some councils were still recording rooms. Fortunately, things have changed a lot since then", says Blandine Cordier Palasse. She is president of the headhunting firm BCP Executives search and former secretary of the board of Gemplus. Governance has become a major issue, and is well on the way to becoming more professional.
Committees at the heart of efficiency
Reducing the number of directorships, evaluating and increasing the number of independent directors, diversifying the membership, etc. Boards of directors, under pressure from both the French government and the Afep-Medef employers' code, are taking steps to improve their effectiveness. According to the latest annual report from the Autorité des marchés financiers, 80% of the listed companies surveyed have a board of directors. Nearly three quarters have combined the functions of Chairman of the Board and Chief Executive Officer. The organisation of committees (audit, remuneration, etc.) is now at the heart of this efficiency.
"Committees often meet four to ten times a year, often for half a day", says Patrick Bignon, founding partner of Bignon de Keyser. A prerequisite for their usefulness is that the directors are provided with the fullest and most transparent information possible. "Some companies have set up databases that can be accessed by secret code. Others provide training courses with financial analysts. Or they organise special days on internal strategy", reports Patrick Bignon.
Training and know-how
The choice of board secretary must be carefully considered. The French Institute of Directors (IFA) has set up a working group on this subject. The secretary plays the role of "facilitator" between the activities of the committees. This role is also played by the Chief Executive, the Chairman and the increasingly well-trained directors. Catherine Leducq is currently training at IFA-Sciences po, despite her solid CV (former financial director of ST Dupont du "Parisien"). "There have been a lot of developments in CSR, Say on Pay and the responsibilities of audit committees. It's very important to keep up to date", she explains.
"Training is not enough. You also need to have a sense of collective responsibility", says Anne Navez, founder of votre-administrateur.com. And beware of the meaning given to the word professionalisation. "Being a director should not be a job in its own right, as this could jeopardise your independence. That's why term limits are essential," says Viviane de Beaufort, a professor at Essec and a specialist in corporate governance.
New profiles
The key word today is diversity. In terms of gender, professions and nationalities. No more "circle of goatees", as Blandine Cordier-Palasse wryly puts it. The aim is to promote expertise rather than networks. This strengthens the independence of its members. The Copé-Zimmermann law, which required 20% of women on boards of directors in 2014 (for listed companies with more than 500 employees and sales of 50 million euros) and 40% in 2017, has borne fruit.
According to data from the Ethics & Boards Observatory published in June, the proportion of women on the boards of CAC 40 companies has risen from 11% in 2009 to 28% today, even if there are inequalities between groups. The latest Russell Reynolds Associates survey, the results of which are published exclusively by Les Echos, shows that France ranks second in Europe behind Norway (38%) and ahead of Sweden (27%).
An interesting phenomenon is that the increase in the number of women on boards "has led companies to look for different sources of talent", explains Viviane de Beaufort. "Boards used to be made up mainly of managing directors, financial directors and strategy directors. Today, the skills are more diverse: marketing, communications, human resources and academics", says Blandine Cordier-Palasse, who also believes that "the presence of legal experts is essential to better assess the risks of liability". As Marc Sanglé-Ferrière and Paul Jaeger, partners at the headhunting firm Russell Reynolds, point out, the number of independent directors is increasing, with women accounting for 74% of independent directors (compared with 61% for men) and 65% in the SBF 120 (compared with 43% for men).
Employee representatives
Another step forward: the law on securing employment, promulgated in June, introduces the obligation to include employee representatives on boards of directors for companies with more than 5,000 employees in France. For the moment, more than half of the CAC 40 companies do not have an employee representative on their board (43% of CAC 40 companies and 21% of SBF 120 companies do). "It will be more or less straightforward, depending on the international scope of the company, its legal structure, the nature of the social dialogue and the trade union map", predicts Anne-Marie Idrac, director and former CEO of RATP and SNCF.
Russell Reynolds points out that the internationalisation of boards is making progress, but there are still limitations, such as insufficient knowledge of the country and problems with physical meetings. As for council evaluations (self-evaluation, internal questionnaire, external expert, etc.), they are still too heterogeneous.
The thorny issue of remuneration
Should the amount of directors' fees be regulated? According to the Russell Reynolds study, while the average remuneration of directors has stagnated in the CAC40 universe, at €63,000, it has fallen in SBF120 companies: from €44,000 in 2012 to €38,000. "Marc Sanglé-Ferrière, managing partner of Russell Reynolds in Paris, believes that this masks a latent war for talent, especially among women. Viviane de Beaufort (Essec) believes that this is a sign of a "war on talent".
she said that "this creates a mismatch in attractiveness.
Large companies can recruit from international pools, but it's more complicated for ET1s. For Anne Navez, "a minimum level of remuneration is essential. A director cannot devote 10 to 20 days of work a year without being paid fairly in return", she says.
