2005 Financial Report - Capgemini

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24 ANNUAL THE GROUP Capgemini cipline. The award was given for his pivotal role in developing the relationship with this key partner and collaborating to ensure Remedy products meet not only the needs of Capgemini but also of the wider outsourcing market. Capgemini Center Certification At least 33 Capgemini centers including Accelerated Delivery Centers, Application Management Services Centers and Technical Excellence Centers now have some form of certification. For example, centers in France, the United Kingdom, Belgium, the Netherlands, Germany, Spain, Italy, the United States, Canada, the Nordic countries and India have ISO certifications including ISO 9001 / ISO 9001-2000. Many centers are also working on their CMM/CMMI® (Capability Maturity Model Integration) certification, specific to the applications development business. The Mumbai and Bangalore centers in India have obtained the highest CMM and CMMI® certification (Level 5), and 9 other centers across France, the Netherlands, Spain, Canada and the US have also achieved CMM/CMMI® (Level 3). 6.3.6 A firm commitment to dialog and communication Bringing together 60,000 people in an ever-changing and highly competitive world and in a spirit of collaboration cannot be achieved without frequent and broad internal communications. Capgemini believes effective communication is a precondition for an open and honest culture and for the involvement and engagement of employees. It is also essential for rolling out knowledge, sharing successes and creating a sense of belonging – to local teams and to the Group globally. In 2005 Capgemini continued to focus on communications at the Group level. In particular: • The Group intranet, Talent, updated with real-time news and information, enjoys over 15,000 visitors each month. Talent includes information, methods and tools concerning the Group and contains links to local sites, training sites and communities. There are over 5,000 subscribers to News Alert, and a Weekly Email Edition is sent to all Capgemini employees every Friday. • 2005 saw a further increase in the number of global channels used for consistent communication with the introduction of weekly audio news “podcasts”. • Talent also runs a themed annual communications and award program, designed to recognize and reward people from all parts of the Group. In 2005 the theme was ‘On the Move’: employees were invited to identify an initiative which they believed had been key to getting things in Capgemini on the move after the market downturn. • Newspapers and rich-media, produced by Group Communications, support communications at special events. • A dedicated channel helps to develop the community and communication between the Group’s principal operatio- REPORT 2005 Capgemini nal leaders. “The Executive” series comprises a monthly newsletter, a calendar of events, a Who’s Who and regular e-mail updates. • In 2005 Capgemini held its first-ever all-staff Webchat, “Let's Talk On-line.” For 90 minutes, the 4 members of the Office of the CEO answered questions from any of the 60,000 employees worldwide in five languages. Those unable to take part could send their questions in advance and all questions were answered. • Electronic community tools such as ‘Community Home Spaces’, ‘Team Rooms’ and other forums continue to evolve to allow internal communities to debate on technical topics, rapidly share best practice and access Group tools and methodologies. • The Group University consistently provides a vital platform for international communication and exchange. Whilst the wealth of global communications initiatives provides cohesion and understanding within the Group, local communications teams, with help from human resources colleagues, play a vital role in supporting the corporate culture. Above all, communication is a daily management task, drawing on various local initiatives developed through newsletters, intranet sites, information meetings and formal or informal exchanges. Communication at the heart of employee transfers Maintaining the involvement and satisfaction of existing employees is only part of the communications challenge. Winning the hearts and minds of the many people who join the company each year as part of an outsourcing deal is equally vital to the success of any deal. In 2005, over 600 people joined Capgemini from Schneider Electric in 26 countries. Communication at all stages was of critical importance. Road shows in the countries, and joint meetings with strong support from Group management, were instruments of success. Websites were set up in several languages to cascade detail on each wave and how it would affect people. A celebration event marked each individual country transfer, with welcome booklets and induction sessions scheduled to ensure rapid integration. Two-way communication and employee involvement At the heart of the Capgemini’s communications philosophy is a commitment to dialog. Whilst informal two-way dialogue is always encouraged, understanding the satisfaction levels of employees is also formally sought through the annual Group survey. Locally managed but globally consistent, the survey tracks a set of questions that remain basically identical over time enabling to monitor changes in satisfaction data and the impact of any corrective action taken. Employees are informed of the results of these satisfaction surveys. Employee representation – a formal voice for employees Capgemini also demonstrates its commitment to formal two-
way dialog through its approach to employee representation. The company upholds the laws of representation and recognizes the importance of constructive dialogue between employees and management in shaping key decisions affecting the running of the Group. In 2001 the International Works Council (IWC) was set up as the official representative body in the Group, meeting 4 times a year. It enables employee representatives to bring employee interests directly to the attention of Group management and in return to be informed directly by management of plans for the company and their impact on its employees. Since 2004, Capgemini has gone beyond the dictates of European legislation and opened the IWC meetings up to members from non-European countries, including the Americas and India, creating a truly globally representative body. In 2005 a working session on Capgemini’s Corporate Social Responsibility was held with the IWC, generating widespread support and suggestions. The IWC also set up a dedicated intranet site to give all Group employees open access to IWC information. At a local level the company also supports dialogue with unions or other employee representatives, within relevant bodies and through the processes provided for in local legislation, regulations and agreements. In France, an Information Dissemination Agreement was signed in 2002 to define the terms and conditions for information to be issued to employees by the unions, Health and Safety Committee and other employee representatives via the Group’s intranet. Similar practices also exist in other countries such as Spain and the United Kingdom. The quality of dialogue with employee representatives is also vital during transitions of people into the Group. For example, in the Schneider Electric deal, contact with unions in each country was established at the earliest point in the cycle and this helped to set up specific legal arrangements to cope with discrepancies between pensions at Schneider Electric and Capgemini. In the UK the ASPIRE deal had over 80 complex employment items to be resolved before any transitions could be conducted. All 80 items were resolved with a group of employee representatives who met weekly with management. 6.3.7 Remuneration policy The Group’s remuneration policy is based on common principles, applied in a decentralized way and tailored to local job market conditions and regulations. The policy aims to: • attract and retain top talent; • reward performance with a remuneration model that is motivating yet flexible; • be consistent with the Group’s financial and operational targets. When local rules permit, employees can select the components of their remuneration package from a predefined menu. This allows employees additional flexibility and enables them to reconcile their financial and personal situations in the best possible way. Profit-sharing is provided to employees where applicable under local regulations in the country concerned. The Vice Presidents and Senior Executives compensation schemes are overviewed and authorized at the Group level for both fixed salaries and variable compensation schemes. Non Vice President and Senior Executive compensation schemes are locally designed and managed but with Group approval on the principles. 6.3.8 Stock options Stock options are granted on a regular basis in line with corporate governance recommendations. These grants are made selectively, with the aim of retaining those employees who have made exceptional contributions to sales, production, innovation or management, or to reward specific initiatives. They are therefore an exceptional reward for specific contributions and do not form part of the Group's general remuneration policy. The Board of Directors granted a certain number of options to 6,193 people under the fifth stock option plan, which was launched in May 2000 and expired in May 2005, and to 650 people under the sixth plan, launched in May 2005 and expiring in July 2008. Details of these grants have been provided each year in the Management Report presented at each Annual Shareholders' Meeting of Cap Gemini S.A. The number of options granted to Directors represents a very small percentage of the total number of options granted (less than 1.2%). Detailed information concerning stock option plans and stock options granted by Cap Gemini S.A. to the ten nondirector employees with the most stock options, as well as the options exercised by those employees is provided on pages 82 and 148 of this report. 6.3.9 Diversity, equal opportunity and working conditions In all countries of operation, the Group complies with local labor legislation and international labor regulations. In its relations with employees, Capgemini endeavors to guarantee equal opportunities for all, with no unlawful discrimination. Principles and values are applied in such a way as to promote diversity, the physical integrity of employees and a fair balance between work and private life. Capgemini is committed to ensuring that individuals are shown respect and that the work environment is free from bullying or harassment. In line with the UN Global Compact and the growing importance of Corporate Social Responsibility, a formal diversity management project was launched in 2004 and built on in 2005. The following are some of the many initiatives that have been rolled out as part of the project: • a diversity charter describing the Group’s commitments in this area was drafted and a diversity management section was added to the external website; ANNUAL REPORT 2005 Capgemini 25
Page 1 and 2: CONTENTS 02 Financial highlights 03
Page 3 and 4: THE CAPGEMINI GROUP I - HISTORY Fou
Page 5 and 6: gence of new players in the global
Page 7 and 8: tions and industry trends, and so o
Page 9 and 10: In fact, the requirement for banks
Page 11 and 12: Simplified organization chart for t
Page 13 and 14: and profitable growth, enabling a p
Page 15 and 16: Graduate Mobility scheme allowing g
Page 17 and 18: Chinese team members. The team is r
Page 19 and 20: Year Average headcount End of year
Page 21 and 22: In order to fine-tune its assessmen
Page 23: 6.3.5 Learning, a major priority Ge
Page 27 and 28: In terms of women’s representatio
Page 29 and 30: • taking environmental impact int
Page 31 and 32: ties managed by leading financial i
Page 33 and 34: usiness interruption, arising from
Page 35 and 36: STOCK MARKET CAPITALIZATION From Ja
Page 37 and 38: MANAGEMENT REPORT PRESENTED BY THE
Page 39 and 40: - Consulting + 2.6% - Technology Se
Page 41 and 42: was more than offset by the investm
Page 43 and 44: fer of the special long-term capita
Page 45 and 46: i.e., 116% of his theoretical varia
Page 47 and 48: two convertible bonds mentioned abo
Page 49 and 50: XII - AUTHORIZATION TO BUY BACK THE
Page 51 and 52: Code, the Board of Directors inform
Page 53 and 54: some years the main corporate gover
Page 55 and 56: the list of the beneficiaries of th
Page 57 and 58: used in the Netherlands and the US,
Page 59 and 60: diarity and define three levels of
Page 61 and 62: forecasts for the next six months a
Page 63 and 64: GROUP CONSOLIDATED FINANCIAL STATEM
Page 65 and 66: CONSOLIDATED STATEMENTS OF INCOME F
Page 67 and 68: CONSOLIDATED STATEMENTS OF CASH FLO
Page 69 and 70: (1) See Note 1.K. (2) At December 3
Page 71 and 72: Intragroup transactions are elimina
Page 73 and 74: at the date of acquisition, which i
Page 75 and 76:
Accounts and notes receivable Accou
Page 77 and 78:
epresents a commitment to convert o
Page 79 and 80:
NOTE 5~OTHER OPERATING INCOME AND E
Page 81 and 82:
NOTE 8~INCOME TAX EXPENSE Income ta
Page 83 and 84:
The Group has no contractual or imp
Page 85 and 86:
NOTE 10~INTANGIBLE ASSETS Changes i
Page 87 and 88:
NOTE 11~PROPERTY, PLANT AND EQUIPME
Page 89 and 90:
Deferred tax assets over one year p
Page 91 and 92:
Deferred tax liabilities can be ana
Page 93 and 94:
NOTE 16~OTHER RECEIVABLES At Decemb
Page 95 and 96:
usiness day) at a price of €41.90
Page 97 and 98:
cisable by the TXU group during the
Page 99 and 100:
B) Fair values At December 31 (in m
Page 101 and 102:
NOTE 20~PROVISIONS FOR PENSIONS AND
Page 103 and 104:
The total relating to other employe
Page 105 and 106:
NOTE 23~ACCOUNTS AND NOTES PAYABLE
Page 107 and 108:
Under IFRS, the sale of carry-back
Page 109 and 110:
B) Analysis of depreciation, amorti
Page 111 and 112:
II. SEGMENT REPORTING BY BUSINESS S
Page 113 and 114:
NOTE 30~LIST OF CONSOLIDATED COMPAN
Page 115 and 116:
Country Consolidated % interest Con
Page 117 and 118:
III. RECONCILIATIONS BETWEEN THE FR
Page 119 and 120:
C) Reconciliation between French GA
Page 121 and 122:
E) Reconciliation between French GA
Page 123 and 124:
G) Reconciliation between French GA
Page 125 and 126:
I) Analysis of IFRS transition rela
Page 127 and 128:
equity in the IFRS balance sheet at
Page 129 and 130:
effective interest rate to the carr
Page 131 and 132:
SUBSIDIARIES AND INVESTMENTS in mil
Page 133 and 134:
STATUTORY AUDITORS’ SPECIAL REPOR
Page 135 and 136:
ment for contributions in kind and
Page 137 and 138:
TEXT OF THE DRAFT RESOLUTIONS PROPO
Page 139 and 140:
the date hereof, for a term of two
Page 141 and 142:
issuance costs against the related
Page 143 and 144:
the Statutory Auditors, the General
Page 145 and 146:
Appropriation and distribution of e
Page 147 and 148:
Proposed renewals to financial auth
Page 149 and 150:
exchange offer to acquire all of th
Page 151 and 152:
Current ownership structure The own
Page 153 and 154:
List of Directorships and other off
Page 155 and 156:
FIRST OFFICES HELD IN 2005 OTHER OF
Page 157 and 158:
DIRECTORS’ INTERESTS This informa
Page 159 and 160:
DECLARATION BY THE PERSON RESPONSIB
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2005 Financial Report - Capgemini

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