SODEXHO ALLIANCE Act as a corporate citizen Report 2005-2006

Vision and strategy Profi le Overview of our initiatives Overall performance
Our clients Our customers Our employees Our suppliers Our shareholders Host countries
PATH TO PROGRESS
Strengthening internal control and
risk management continue to remain key
priorities for the Group. The CLEAR initiative
will continue in the future as a best practice
within the Group in the area of internal
controls.
MEET
Siân Herbert-Jones, Group Chief
Financial Offi cer and member of the
Group Executive Committee
We intend to continue to improve
our control of risks, by improving assessment
processes, standardizing controls
and exchanging best practices.
ASSESSMENT OF INTERNAL
CONTROL PROCEDURES
Since 2003, the senior management
of the Group has demonstrated
its commitment to enhancing
the internal control environment
by launching an ambitious program:
CLEAR (Controls for Legal
Requirements and to Enhance
Accountability and Reporting).
The project has involved the review
of existing internal control practices
and the identifi cation of improvements
and productivity gains.
The framework developed by
the CLEAR project, based on
the COSO (Committee of Sponsoring
Organizations) model segments
the Group’s activities into eleven
signifi cant processes, which are
described in the Chairman’s Report
(found on p. 67 and 68 of the
Reference Document).
In addition to the COSO model,
the Group developed procedures
for the principal subsidiaries
to describe their internal controls.
The principal subsidiaries identifi ed
their key risks, and documented
the effectiveness of their internal
controls, as well as responded to
a questionnaire related to the fi ve
major COSO components.
58
Over the last two fi scal years,
the principal Sodexho subsidiaries
have been working to identify
the main risks and to review and
document appropriate controls.
At the same time, fi nancial
statement controls have been
tested to ensure they are
operating effectively.
Project CLEAR has mobilized more
than 700 people in the last two
years. The project has been adopted
by the subsidiaries as a continuing
initiative to improve risk
management and to reinforce
rigorous and effective procedures.
As Sodexho is listed on the New
York Stock Exchange in the United
States, it is subject to the rules of
the Securities and Exchange
Commission and notably the terms
of the Sarbanes-Oxley Act.
As part of the compliance process,
the Chief Executive Offi cer
and Chief Financial Offi cer are
required to prepare a report on
internal controls over the Group’s
fi nancial reporting in FY 06.