The way that the Board is structured and operates, with eight independent Directors, makes it possible, where necessary, to prevent shareholders, acting individually or in concert, from abusing their rights to the detriment of the Company.
Regarding any arrangement or agreement entered into with major shareholders, customers, suppliers or others under which a Director was selected to sit on the Board of Directors, there was an agreement in place between the Bettencourt Meyers family and Nestlé SA (which expired on 21 March 2018) focused on the reciprocal voting commitment in favour of the appointment as Directors of three members proposed by the Bettencourt Meyers family and two members proposed by Nestlé.
The Company was informed of an interest, amounting to 100 shares, of its Chairman, Jean-Paul Agon, in the collective lock-up agreements signed on 16 December 2016 by Téthys SAS and members of the Bettencourt Meyers family group under the Dutreil law. The Nominations and Governance Committee Meeting of 6 December 2016 examined this arrangement prior to the signing of the agreement and considered that it could not be contested on the basis of the Company's best interests, nor could it give rise to consequences for the Company's governance, and informed the Board of Directors accordingly.
The Company was informed that a new collective lock-up agreement was signed on 29 December 2023 under Article 787 B of the French Tax Code, similar to those entered into in 2016 (which were terminated earlier the same date), with the addition of the company Financière L'Arcouest (controlled by Françoise Bettencourt Meyers and her family). The Nominations and Governance Committee Meeting of 6 December 2023 examined this arrangement prior to its signing and confirmed that it could not be contested on the basis of the Company's best interests, nor could it give rise to consequences for the Company's governance, and informed the Board of Directors accordingly.
No corporate officers have a service contract with L'Oréal or any of its subsidiaries providing for the granting of benefits upon termination of such contract.
The Board took note of the rules to be applied in order to prevent insider trading, in particular those resulting from European Regulation (EU) No. 596/2014 on market abuse, which became applicable on 3 July 2016, and the recommendations of the French Financial Markets Authority, in particular regarding closed periods during which trading in shares is prohibited. It amended the Internal Rules of the Board accordingly. Where applicable, Board members are kept informed of any developments related to stock market regulations.
On the basis of legal provisions, regulations and market recommendations, L'Oréal's Stock Market Code of Ethics points out that inside information must not be passed on and must only be used for professional purposes.
Inside information is information of a precise nature which has not been made public and which, if made public, would be likely to have a significant impact on the share price.
The Stock Market Code of Ethics sets out the prohibition of any person in possession of inside information from executing, ordering the execution of or recommending any financial transactions on L'Oréal shares, and emphasises that any misconduct in this area may result in criminal proceedings. The Internal Rules of the Board specifically remind Directors not to trade in L'Oréal shares in certain specific periods and when they have access to inside information.
Directors are required to notify the AMF of each transaction related to L'Oréal shares that they carry out or that is carried out by anyone closely associated with them, in accordance with the terms and procedures laid down in the applicable regulations. The Company periodically reminds those concerned of this obligation (see section 2.6).
