Contents

2Corporate governanceBoard of DirectorsDirector independenceUntil 4 June 2012, the composition of the Board of Directorsreflected the Company’s ownership structure and notably the provisionsof the shareholders agreement between Exor SA, DLMD andPascal Lebard (see page 189). Since the termination of said agreement,signalling the end of the agreement to act in concert, Sequanacan no longer be considered as a controlled company. The agreementsigned on 4 June 2012 by Sequana’s main shareholders does not constitutean agreement to act in concert since each shareholder effectivelyacts on its own behalf.Directors are considered independent if they have no direct or indirectrelations of any nature with the Company, the Group or theGroup’s management that could compromise their freedom to makeindependent decisions. Independent directors should not:■■be employees or corporate officers of the Company, employeesor directors of the parent company or of a company consolidatedby the parent, nor have occupied any of these positionsover the previous five years;■■be corporate officers of an entity in which the Company holdsa directorship, either directly or indirectly, or in which one ofits employees (designated as such) or corporate officers holds adirectorship (either at present or over the past five years);■■be a major customer, supplier, commercial banker or investmentbanker of the Company or the Group to which it belongs,or for which the Company or the Group accounts for a significantportion of business;■■have any close family ties to a corporate officer;■■have been an auditor of the Company over the previous five years;■■have been a director of the Company for more than twelve years.Given the positions that they occupy in the Company, Tiberto RuyBrandolini d’Adda and Pascal Lebard do not qualify as independentdirectors. In view of the Company’s ownership structure and theexistence of a shareholders’ agreement, their representatives may notbe considered as independent directors. Moreover, Laurent Mignon,as Chief Executive Officer of Natixis, one of Sequana’s main bankingpartners and creditors, is deemed to have a conflict of interestsand does not qualify as an independent director. The same considerationapplies to Odile Desforges given her links to FSI.Therefore, based on generally accepted independence criteria setout in reports published by AFEP-MEDEF, of the ten directorssitting on Sequana’s Board in 2012, three qualify as independent,namely Luc Argand, Jean-Pascal Beaufret and Michel Taittinger.The Board noted that Michel Taittinger has been a member ofone of Sequana’s corporate entities since 2000 but considers thathe still qualifies as an independent director despite the fact thathis cumulative terms of office exceed the 12-year period recommendedby the AFEP-MEDEF code. Michel Taittinger was anon-voting member of the Supervisory Board of Sequana (formerlyWorms & Cie) between 2000 and 2005. He became aSequana director in May 2005 and has only been able to vote atBoard meetings since that date. Therefore, the Board of Directorsconsiders that a person who has been a member of a corporateentity for more than 12 years should not automatically lose theirstatus as an independent director if they have been acting in anon-voting capacity for part of that period. The concern thatan excessively long term of office may limit the holder’s powersof analysis is perfectly legitimate, however it should not beapplied mechanically or without due regard to the diversity ofsituations. In the case in point, the length of Michel Taittinger’sterm of office has not been deemed an obstacle to his freedomof judgement or expression in Board meetings. Rather,Michel Taittinger’s experience is of major benefit in helping toassess the performance of Sequana and its businesses in all theircomplexity and ensuring effective oversight and control over theCompany. Michel Taittinger’s personal qualities, together withthe absence of any conflicts of interest with the Group’s activities,reinforced the Board’s opinion in this regard.If the list of independent directors proposed by the Boardof Directors is approved at the Annual General Meeting of27 June 2013, the Board will comprise five independent directors(Luc Argand, Jean-Pascal Beaufret, Jean-Yves Durance,Michel Taittinger and Marie Lloberes) out of a total of ten directors,i.e., half of all Board members will qualify as independent,thus bringing the Company into line with corporate governanceguidelines on director independence.Particular attention is paid to ensuring directors’ freedom ofjudgement on the Board and the Board’s committees, especiallythose bound by a shareholder agreement, to ensure that the directorscan fulfil their duties with the objectivity required.58 | Sequana | 2012 Document de référence (English version)