ANNUAL REPORT 2006-2007

ENSURING GOVERNANCE AND TRANSPARENCY SODEXO AROUND THE WORLD
> Corporate Governance
ASSESSMENT OF INTERNAL CONTROL PROCEDURES
The internal controls put in place by management,
are part of an ongoing process of identifying, evaluating
and managing the Group’s risk exposures.
Sodexo’s senior management demonstrated its
commitment to enhancing internal control with
the launch in Fiscal 2004 of the CLEAR program
(Controls for Legal requirements and to Enhance
Accountability and Reporting). This ambitious
program resulted in Sarbanes-Oxley certifi cation
in Fiscal 2006, confi rmed by the Group’s external
auditors. The CLEAR initiative, strongly endorsed by
the Chief Executive Offi cer and Group Chief Financial
Offi cer, was approved by the Board of Directors and
the Audit Committee, and also received the backing
of the Group’s Executive and Operational Committees.
Since it was fi rst launched, CLEAR has mobilized
more than 700 people within the different subsidiaries
and departments of the Group.
RISK MANAGEMENT
Sodexo has a pro-active approach to risk management,
with the aim of protecting its employees and clients
and safeguarding the interests of the Group and
its shareholders.
Specifi c policies are in place designed to ensure
that risks are properly evaluated and managed
at the appropriate level within the organization.
A risk-mapping exercise is conducted each year
by the Executive Committee, and presented to
the Audit Committee.
The Audit Committee and the Board of Directors
as well as various functions within the Group and
the external auditors have been regularly informed
of the progress of this initiative and the chosen
methodologies.
On April 24, 2007 the Board of Directors of Sodexo
decided to delist from the New York Stock Exchange
and deregister from the U.S. fi nancial market.
Despite this decision determination to improve
the effectiveness of internal control remains a key
priority. It is for this reason that management has
committed to reinvesting part of the savings gained by
delisting from the NYSE to provide robust, sustainable
improvements to the internal control structure.
Sodexo’s policy on risk management and insurance
involves working closely with subsidiaries to:
identify and evaluate the key risk exposures faced
by Sodexo, with particular attention focused on
the emergence of new risk factors associated with
changes in our activities, especially in Facilities
Management;
reduce contractual risk, in particular by using
limitation of liability clauses or hold-harmless
agreements;
achieve the right balance between risk retention
(self-insurance) and the insurance market in
covering the potential fi nancial consequences
of Sodexo’s risk exposure.
Sodexo_Annual Report 2006-2007
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