Report
Expert Corporate Governance Service (ECGS)
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L'Oréal, April 18th, 2019

ITEM 6: the 2019 remuneration policy does not comprise any change compared to 2018. Thus it carries the same weaknesses (excessive potential amounts and potential vesting in case of underperformance). Thus, we do not support item 6.

ITEM 7: for the first time, the company discloses individual achievement rates of the annual bonus financial criteria. However, it still does not disclose targets to be achieved, for confidentiality reason. We could hear this argument for an a priori disclosure, but in the case of a past fiscal year, this is not admissible. Moreover, it does not disclose either LTI performance criteria targets for the granted LTI or the vested LTI, which does not allow shareholders to estimate whether they are sufficiently challenging. For these reasons, and considering amounts at stake (€9.5 M), we do not support item 7.

Underlying
L'Oreal S.A.

L'Oreal acts as a holding company. Through its subsidiaries, Co. plays a strategic coordination role and scientific, industrial and marketing coordination role on a global basis. Co. develops, manufactures and commercializes products for Skin care, Hair care, Make-up, Perfumes, Toiletries and deodorants, and Oral cosmetics. Co. has three branches: Cosmetics, Body shop and Dermatology. Co.'s principal activities comprise four divisions: Professional Products, Consumer Products, L'Oreal Luxe and Active Cosmetics. The Body Shop branch offers various cosmetics and toiletry products. The Dermatology branch offers topical dermatology prescription, and corrective and aesthetic dermatology.

Provider
Proxinvest
Proxinvest

Founded in 1995, Proxinvest is an independent proxy firm supporting the engagement and proxy analysis processes of investors. Proxinvest mission is to analyse corporate governance practices and resolutions proposed at general meetings of listed firms.

Proxinvest main services are :

  • ​Proxy reports
  • Definition and monitoring of client customized voting guidelines
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  • Thematic research
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Proxinvest has been a pioneer and champion of good corporate governance and has grown into a recognised expert in the field.

Proxinvest is independently-owned and only works for investors : Proxinvest does not provide consulting services to the companies it covers, mitigating related risks to its clients and ensuring the independence of our analysis. As a result Proxinvest is able to take a robust, independent, engaged and unconflicted view of the companies in which our clients invest.

As Managing Partner of Expert Corprate Governance Service Ltd (ECGS), Proxinvest has built a large network of corporate governance experts to support clients in corporate governance analysis worldwide. 

Analysts
Expert Corporate Governance Service (ECGS)

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