financial report and registration document 2011 - Groupe SEB

� respect for rules governing division of responsibilities;
� policies applying to insurance cover and hedging;
� fi nancial reporting audit principles.
The risk analysis and internal control processes use two basic tools:
� an annual “top-down” review and analysis of the main risks. In 2011, the
members of the Group Executive Committee, the Director of Legal Affairs,
the Director of IT Systems, the Director of Quality, the President in charge
of Innovation, the President in charge of Strategy, the Presidents of the
three core business units and the President for China were interviewed
individually to help identify and analyse the top ten risks that Groupe SEB
is or could be exposed to. Each risk was evaluated in terms of probability
and impact, and actions to mitigate each risk were identifi ed. This resulted
in the annual map of risks faced by Groupe SEB;
� a “bottom-up” process involving self-assessment questionnaires, based
on processes. These are sent out to each operational entity and are
designed to identify possible weak points and encourage the practice
of internal control at all levels, with a view to making Group operations
more effi cient.
Internal control participants
THE BOARD OF DIRECTORS, THE AUDIT
COMMITTEE AND THE NOMINATIONS
AND REMUNERATION COMMITTEE
The role of these bodies is described in the “Organisation and Operation of
the Board of Directors” section, pages 26, 27 and 28.
GROUP EXECUTIVE COMMITTEE AND GROUP
MANAGEMENT BOARD
Their role is described in the “Group Management Bodies” section, page 29.
THE INTERNAL AUDIT DEPARTMENT
Internal audit, as defined by professional standards, consists of
“an independent and objective process which ensures that the Group has
adequate control of its operations and which offers advice on improving the
latter while contributing to added value. The internal audit function helps the
Group to achieve its objectives by systematically and methodically evaluating
its risk management, control and corporate governance procedures, and
through recommendations for their improvement.”
The role of the Groupe SEB Internal Audit department is fully consistent
with this approach.
The Internal Audit department is responsible for evaluating, at all locations
where the Group is established and for all functions, compliance with Group
Internal Rules and procedures and any non-compliance with legislation, and
for ensuring that Group assets are protected. It is also required to evaluate
the effi cient conduct of operations and to ensure that all business risks are
anticipated and controlled.
Financial Report and Registration Document 2011
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Corporate governance
Chairman’s report on internal control
In 2011, the self-assessment process was completed as in previous years,
with one questionnaire every two years for each Group entity.
Added to these two methods of evaluation are internal audits of all entities
and of all the Group’s functions, as well as the annual and half-yearly reviews
carried out by the Statutory auditors.
In 2011, the Internal Audit department carried out missions at 12 market
companies representing 29% of the Group’s sales, and at three plants,
representing 32% of Group production, and it analysed fi ve Group processes.
The crisis management system, established in 2010, was put into action
in 2011 in response to the natural disasters in Japan and Thailand.
Improvements were made to the system based on these real-life situations.
The parties involved underwent new training and are now equipped with
additional documents that prepare them to deal with specifi c issues.
In the area of risk management, the Internal Audit department draws up a
map of high-level risks.
Based on this map, on the self-assessment questionnaires and on the
principle of an audit in each entity every three or four years, the Audit
department proposes an internal audit plan for the following year.
This plan is submitted to the Audit Committee.
Each internal audit – adapted to circumstances and conducted locally by
an average of three Auditors over a two-week period – gives rise to an audit
report which is sent to the audited structures and their upline management,
to the members of the Group Executive Committee and to the Group
Chairman and CEO, describing the basic organisation of each process and
making recommendations.
Steps are then taken by operational management to remedy identifi ed
shortcomings in internal control, and to make any other necessary
improvements. The implementation of resulting action plans is subjected to
a systematic internal audit review within 12 months of the audit.
The results of these audits are compared with the results of the selfassessments,
thus completing the full circle of the internal control process.
In order to ensure continuous improvement of internal control and Company
effi ciency, the main recommendations issued by the Audit department for
each process are shared annually with the Group Management Committee
for the main Group divisions: Purchasing, IT, Quality, Finance, Human
Resources, Supply Chain, Production, After-sales Service and Marketing.
The Internal Audit department draws up an annual report of work done which
is presented to the Group Executive Committee and the Audit Committee.
The Audit Committee reviews the resources needed by the Internal
Audit department to carry out its work, and makes observations or
recommendations as required. The Internal Audit department has a staff
of ten people.
GROUPE SEB
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