registration document France Telecom 2009 - Orange.com

14 STRUCTURE
administrative and management bodies and senior management
AND FUNCTIONING OF THE GENERAL MANAGEMENT
14.1.4.2 Main differences between the rules
of corporate governance followed
by France Telecom and the rules
of the New York Stock Exchange
for US companies
France Telecom has endeavored to take into account the New
York Stock Exchange governance standards. However, as a
non-US company, France Telecom is not obliged to comply
with the majority of these rules and may choose to follow rules
applicable in France. As such, France Telecom has elected to
adhere to the Afep-Medef code of corporate governance (See
Section 14.1.4.1 Adoption of a code of corporate governance),
whose recommendations differ in some respects from the rules
of the New York Stock Exchange for US companies.
In particular, France Telecom has chosen to follow the rules of
independence set forth by the Afep-Medef code, which provide
that one-third of the directors must be independent. In contrast,
the New York Stock Exchange standards provide that the Board
of Directors must consist of a majority of independent directors.
Moreover, France Telecom considers that seven of the 15
members of its Board of Directors are independent according
to the criteria of the Afep-Medef code. France Telecom has not
evaluated the independence of its directors under New York
Stock Exchange standards.
In addition, France Telecom has chosen to establish a single
Governance and Corporate Social Responsibility Committee in
charge of appointments and compensation . This committee is
currently composed of two independent directors elected by the
shareholders, and one representing the French Government,
and does not include any executive corporate offi cer. Conversely,
the NYSE standards provide for the implementation of two
separate committees (a S election and C orporate G overnance
C ommittee and a C ompensation C ommittee) composed
exclusively of independent directors.
14.2 STRUCTURE AND FUNCTIONING OF THE GENERAL MANAGEMENT
Mr. Stéphane Richard has been Chief Executive Offi cer of
France Telecom since March 1, 2010.
14.2.1 Management and limits set on
CEO’s authority
In connection with the preparation for his succession, on February
24, 2010 Didier Lombard proposed that the Board of Directors
separate the Chairman’s offi ce from the Chief Executive Offi cer’s
offi ce and appoint Stéphane Richard as Chief Executive Offi cer
as from March 1, 2010. The Board approved this proposition
on February 24, 2010. Didier Lombard was confi rmed as
Chairman of the Board of Directors (see Section 14.1.3.1 Board
of Directors’ functioning and activity).
As Chief Executive Offi cer and in accordance with the law,
Stéphane Richard was invested with extensive power to act in
the C ompany’s name, without any limitation of power other than
that provided for under the law and in Article 2 of the Board
of Directors’ Internal Guidelines as amended on February 24,
2010 (see Section 14.1.3.1 Board of Directors’ functioning and
activity).
Article 2 provides that the Chief Executive Offi cer must obtain
the authorization of the Board to engage the Company in
investments or divestitures involving amounts in excess of
200 million euros per transaction, when such transactions are
acquisitions or disposals. In addition, any investment involving
amounts in excess of 20 million euros that does not fall within
France Telecom’s strategic plans must fi rst be approved by the
Board of Directors.
Following his appointment, the Chief Executive Offi cer
introduced a set of power and signature delegations to each
member of the Executive Committee (see Section 14.3 Internal
Control and Risk Management). Each member of the Group
Management Committee may further delegate such authority
within his or her own area of responsibility.
14.2.2 Information on the Chief
Executive Officer
Stéphane Richard, 48, joined France Telecom in
September 2009, and on October 5, 2009, he was appointed
Deputy CEO in charge of France Operations. He became a
corporate offi cer as CEO Delegate on January 1, 2010, and
Chief Executive Offi cer of France Telecom on March 1, 2010.
Since 2007, Stéphane Richard had been Chief of Staff at the
French Ministry of the Economy, Industry and Employment.
Between 1992 and 2003, he was Deputy CFO of Compagnie
Générale des Eaux, Chief Executive Offi cer of Compagnie
Immobilière Phénix, Chairman of CGIS, now Nexity. In 2003,
he became Deputy CEO of Veolia Environnement and Chief
Executive Offi cer of Veolia Transport. From 2003 to 2007, he
was a France Telecom Board member . Stéphane Richard has
degrees from Ecole des Hautes Etudes Commerciales and
Ecole Nationale d’Administration.
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2009 REGISTRATION DOCUMENT / FRANCE TELECOM