CONTENTS - Capgemini

is based on the percentage of attainment of quantified objectives
set out in the Group budgets (consolidated revenues, operating
income, cost of corporate functions, etc.), and the other half on
the degree to which a certain number of personal objectives have
been achieved.
The committee reviewed, and occasionally modified or completed,
and submitted for final approval by the Board of Directors, the
list of the beneficiaries of the 2,067,000 stock options granted on
October 1, 2006 to 692 Group employees.
The committee’s proposal to modify the formula for allocating
directors’ attendance fees was accepted by the Board of Directors
(see section 1.5).
The committee recommended the creation of a fourth specialized
committee with responsibility for corporate governance matters,
and proposed that it be chaired by Serge Kampf.
It also heard reports from the directors of the Group’s strategic
Business Units, who presented the key members of their management
teams, their three-year business plans, as well as an overview
of succession plan options.
Lastly, throughout the year the committee oversaw the review
launched last year with the help of Towers Perrin aimed at setting
up a Group-wide defined benefit pension scheme – of the like that
exists within substantially all companies in the CAC 40 – for senior
executives meeting a certain number of an objective criteria and
who have made a major and lasting contribution to the Group’s
development. The committee’s conclusions on this review were
presented to the Board of Directors, which subsequently decided
to authorize Group Management to set up such a plan with effect
from January 1, 2007.
1.4.3 Ethics & Governance Committee
This committee is tasked with verifying that in all of its activities
and in all subsidiaries under its control, in all internal and external
communications – including advertising – and in all other acts
undertaken in its name, the Group’s seven core values are correctly
applied and adhered to, defended and promoted by the Group’s corporate
officers, senior management and employees. It is also briefed
with overseeing the application of good corporate governance rules
within Cap Gemini S.A., validating succession plans put forward
for (and often by) the Group’s senior management – including the
Chairman and the Chief Executive Officer, proposing to the Board
of Directors any changes it considers relevant to its functioning and
composition (co-opting new directors, limiting their number, etc.) as
well as any legal or operational changes to the corporate governance
rules currently in force within the Group (for example, switching
to or from a legal form that separates or combines the functions of
Chairman and Chief Executive Officer, etc.).
The composition of this Committee is currently as follows:
- Chairman: Serge Kampf
- Other directors: Daniel Bernard, Paul Hermelin, Phil Laskawy
and Bruno Roger
- Non-voting director: none
The decision to set this committee up was only taken in the second
half of 2006, and it is scheduled to hold formal meetings on two
or three occasions during 2007.
1.4.4 Strategy & Investments Committee
This committee reviews and arbitrates between the various strategic
options that the Group may adopt to ensure its continued growth,
profitability and independence, calibrates the investment required to
implement each of these possible strategies, oversees the subsequent
implementation by management of the strategy decided by the Board
of Directors, assesses potential or strategically necessary alliances or
acquitions, and more generally, deliberates on any issue considered
relevant to the Group’s future and to guaranteeing operating and
financial stability. The composition of this committee is currently
as follows:
- Chairman: Jean-René Fourtou
- Other directors: Daniel Bernard, Paul Hermelin, Thierry
de Montbrial and Bruno Roger
- Non-voting director: Geoff Unwin
This committee met four times in 2006, with an attendance rate
of 78% (18/23).
In 2006, it devoted the bulk of its time to monitoring the global
strategic plan approved in the previous year, aimed chiefly at
enabling the Group to improve profitability and growth within
each of its four disciplines: Consulting Services, Technology
Services, Local Professional Services and Outsourcing Services. It
reviewed the conclusions of an analysis of three major business
and performance indicators (the Group’s current situation, market
developments and breakthrough technologies), and played
an active part in the preparation of the transformation program
baptized “I cubed” and based on three main avenues for development:
innovation (choosing profitable segments and strengthening
the Group’s leadership position); industrialization (lowering costs
and increasing productivity, notably on long-term contracts),
and intimacy, promoting close client relationships – one of the
Group’s key differentiation factors. The committee put forward
a number of useful suggestions for presenting the themes to be
debated at the 21st Rencontres held in Montreal, which brought
together approximately 500 Group executives from September 27
through September 30, 2006.
1.5 Compensation of directors
By way of compensation – albeit only partial – for their responsibilities,
and for time spent preparing for and participating in Board
and committee meetings, the Company was authorized by the
General Shareholders’ Meeting of May 11, 2006 to pay attendance
fees to directors within an overall ceiling of €700,000 per year.
Further to the Selection & Compensation Committee’s proposal,
the Board of Directors decided on July 26, 2006 to implement a
new formula for allocating directors’ attendance fees, based on
the following principles:
the elimination of the fixed portion that was attributed based
on position: director, non-voting director or committee member
(except for the chairmen of the specialized committees and the
Chairman of the Board of Directors, who each receive a fixed fee
of €20,000 per annum in view of their special responsibilities
and the heavy workload required to discharge their duties);
payment of a uniform amount of €3,000 per attendance at
official meetings of the Board or one of the four specialized
committees. This fixed fee may be readjusted in the event that
an exceptional number of meetings leads aggregate attendance
fees to exceed the annual ceiling of €700,000 set by the General
Shareholders’ Meeting of May 11, 2006;
the payment of directors’ attendance fees twice yearly on June
30 and December 31, as opposed to once per annum as was
previously the case.
ANNUAL REPORT 2006 Capgemini
53