The world's local bank - HSBC

HSBC FRANCE
Chairman’s report on corporate governance and internal control procedures (continued)
the Board and its Committees. The Committee also
examined the position of P Pontet and P Shawyer,
in the light of their previous experience, with a view to
proposing to the Board and the AGM that they be
appointed. In particular, it was deemed that
P Shawyer, who has spent his entire career at Deloitte
& Touche, and who is an independent Director of
HSBC Bank plc, should become a member of HSBC
France’s Audit Committee.
Since the AGM held on 12 April 2000, the
Directors’ term of office has been four years.
The Board’s work in 2005
Before each Board meeting, Directors receive an
agenda together with the draft minutes of the
previous Board meeting. In the week prior to the
meeting, they also receive background information on
agenda items and, a few days ahead of the meeting, a
summary of key financial indicators. In the case of
highly confidential issues, which cannot be disclosed
in advance, the information is provided during the
meeting itself. On the other hand, Directors are
regularly advised of significant events affecting the
company and receive the relevant documents.
The Board of Directors met five times during
2005, with an average attendance rate of 80 per cent
compared with 82 per cent in 2004:
– 12 January 2005,
– 22 February 2005,
– 17 May 2005,
– 26 July 2005,
– 29 November 2005.
In 2005, the Board of Directors reviewed the
group’s quarterly, half-yearly and annual financial
statements and approved the half-yearly and annual
accounts. It also approved the budget for 2005 in its
meeting held on 22 February 2005.
The Board held a special meeting on 12 January 2005
to consider the strategic plan “Efficacité pour la Croissance”
(“Managing for Growth”) and its targets. The
meeting was attended by all members of the Executive
Management Committee, who commented on the
work that needed to be prioritised to execute the plan.
In subsequent meetings, the Board was regularly
informed about progress in the plan’s initial stages,
particularly regarding rebranding and all employeerelations
aspects. The Board reviewed the group
strategy for all capital markets activities
(17 May 2005) and the strategy for personal customers
as part of the rebranding (29 November 2005).
The Board considered various disposals of
subsidiaries that were considered non-core in terms
of the company’s development, such as Framlington,
HSBC Dewaay and Netvalor. It also approved
various streamlining operations, particularly the simplification
of HSBC France’s UK interests through the
restructuring of Charterhouse Management Services
(CMSL).
The Board regularly reviewed HSBC France group’s
credit, market, litigation and operational risk situation.
It examined the CRBF 97-02 annual report sent to the
French Banking Commission on internal control, and
examined follow-up letters and responses to the French
Banking Commission following its audits.
Finally, it was informed of a major reorganisation
in the company’s Executive Management, which took
place in the autumn of 2005.
The Board reviewed the detailed reports
submitted by the Chairmen of its special committees.
As part of this work, the Board was kept informed
of work relating to the implementation of IAS/IFRS
and work complying with Basel II prudential
regulations. It was also made aware of procedures
necessary to comply with the Sarbanes-Oxley Act.
Apart from these major issues, the Board also
discussed various other issues which are legally its
responsibility.
Special committees
Nomination and Remuneration Committee
Composition:
Chairman:
– Paul Dubrule Appointed 1999 and 2002
(independent)
as Chairman
Members:
– Philippe Houzé Appointed 1999
(independent)
– Stephen K Green Appointed 2000
– Jean-Claude Jolain Appointed 2005
(independent)
The Committee’s main tasks are as follows:
– making proposals to the Board of Directors
regarding the appointment of Directors and
members and Chairmen of the Board’s specialist
committees;
– proposing a Chairman and a CEO to the Board,
and proposing Deputy CEOs to the Board on the
CEO’s recommendation, for succession planning
purposes or in the event of a vacancy;
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