2007 Interactive Registration Document - Renault

04 REPORT
CORPORATE GOVERNANCE
OF THE CHAIRMAN OF THE BOARD PURSUANT TO ARTICLE L. 225-37 OF THE COMMERCIAL CODE
4.5.2.3 INTERNAL CONTROL SYSTEM
ELEMENTS ✦
SHARED CORPORATE VALUES AND PRACTICES
The Renault group has a Code of Good Conduct and compliance rules, which
were updated in 2007 and approved by the Board of Directors on September 26,
2007. This Code took effect on January 1, 2008, when the post of senior
Compliance Offi cer was created. This offi cer is tasked with ensuring that the
Code is properly applied and verifying compliance with international procedures
and rules on best practice. He or she also makes recommendations aimed
at optimizing these procedures and organizational structures, as part of a
dynamic approach. In the role of advisor to senior management, to whom he
or she reports, the senior Compliance Offi cer promotes the Renault group’s
compliance policy.
In addition, the Group is setting up a whistleblowing system that will allow any
member of staff to report instances of deviance from these values and ethics,
solely in the areas of accounting, fi nance, banking and combating corruption.
Lastly, the Internal Audit department is charged with ensuring compliance
with procedures, notably with respect to detecting and dealing with suspected
fraud.
DEDICATED ORGANIZATION
Strategic decisions are examined fi rstly by the Group Executive Committee,
which comprises the President and CEO, the fi ve Executive Vice Presidents and
the Corporate Secretary General . These decisions are submitted to the Board
of Directors, after seeking the opinion of the International Strategy Committee
should the need arise. The President and CEO informs the Board about the
enforcement of such decisions.
The Renault Management Committee is composed of the members of the
Group Executive Committee and heads of Renault’s main departments.
Its members ensure that decisions are implemented in compliance with legal
requirements in the countries where the Group operates, in conjunction with
the management committees of the main operational departments. The Group
Executive Committee keeps track of operations by monitoring budget outturns
relative to the original budget. An update on the Group’s commercial and
fi nancial position is presented at each Board meeting.
In 2006 the Group reorganized operations around a matrix-based system so as
to coordinate the activities of the Regions and the Vehicles Program and Global
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Function departments (engineering, purchasing, manufacturing and marketing).
Five Regions were created, each managed by a Regional Management
Committee (CMR), four of which are chaired by a senior manager. CMRs are
composed of representatives of Global Functions and Vehicles Programs and
of the managers in charge of the major countries in the Region.
In addition to management reporting lines, the Group also introduced a system
of staff reporting lines enabling support departments to conduct their activities
on a cross-functional basis.
CLEARLY DEFINED RESPONSIBILITIES AND POWERS
The decision-making process followed by the Renault group is based on a
system of delegation of responsibilities, starting with the powers of the President
and CEO and working downwards. The system specifi es precisely the levels at
which line personnel are entitled to make decisions.
Delegation rules have been adapted to the new organization to bring the
decision making system into line with Renault’s three-pronged organization
structure: Regions/Global Functions/Programs. The new rules refl ect a strong
determination to delegate to the Regions and increase the accountability of
operational staff while ensuring that decisions are taken at the right level.
Some operations are not delegated. These are equity transactions for
subsidiaries, sales and acquisitions of companies or businesses, partnerships
and cooperation agreements, and hedging raw material or exchange rate risks.
Such operations are examined by a committee of members drawn from the
departments concerned. This committee gives its opinion before submitting
operations for approval to the President and CEO.
MATCHING HUMAN RESOURCES TO THE SYSTEM
To ensure that decision-makers and line personnel have the skills and
profi ciencies needed for each post, the Group has established an organizational
system based on functional skills and sectors. This system optimizes resources
management through human resources committees tasked with matching skills
to job requirements, planning future human resources requirements on the basis
of career paths for key positions, and providing training.
In the sphere of fi nance, the Management-Finance Academy created in 2006
offers professional development for careers in management and fi nance
functions. It contributes to training in business economics for all company
employees and to the deployment of management rules. It extended its franchise
in 2007, offering training in fi nancial matters for 2,500 managers from the
Global Function engineering division.
150 Registration Document Renault 2007
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