FRANCE Law and Practice Contributed by: Jean-Christophe Devouge and Kaïs Boussadia, Aurès
by organising its work, preparing agendas, issuing notices and drafting minutes. The role also includes overseeing compliance, co-ordinating with commit - tees and internal functions, and assisting with general meetings. To ensure independence and efficiency, the secretary typically reports to the chair and must be provided with adequate resources. In two-tier board systems, the supervisory board is responsible for the supervision of the management and the preservation of the company’s long-term interest. Therefore, the supervisory board: • appoints the members of the management board and defines their compensation schemes; • controls the annual financial statements; • reviews the management reports; and • approves related-party agreements. Unlike the board of directors, the supervisory board is not entitled to make management decisions. The executive board is in charge of the strategy of the company and its day-to-day management, within the limits of the general meeting’s powers. The chair of the executive board has the broadest powers to represent the company towards third parties. SAS The chair of the SAS is the only mandatory manage - ment body of the company, and is therefore entrusted with the broadest powers to manage the company within the limits of the shareholders’ powers and rep - resent it towards third parties. The shareholders may set up other corporate bodies to assist or supervise the chair. Internally, the chair’s powers shall be limited by specific powers granted to these corporate bodies. The shareholders may also decide to limit the chair’s powers in the by-laws and require prior authorisation from the shareholders for material decisions. Those limits may, however, be enforced towards third parties only if it is proven that they had knowledge of such limitations. SARL In a SARL, each of the managing directors has the broadest powers to manage the company within the
limits of the corporate scope and shareholders’ pow - ers. The same rules regarding third parties apply to the managing directors. 2.3 Decision-Making Processes The applicable decision-making process depends on the nature of the corporate body. Collegiate management and/or supervisory bodies meet periodically on a pre-defined agenda. Meetings are called by the chair, and the convening process is freely determined in the by-laws or other internal rules, if any. For the adoption of defined decisions, such as the approval of annual or interim accounts, the statutory auditors (if any) must be given notice of the meeting. As part of this decision-making process, board members must be provided with all information necessary to enable them to make an informed deci - sion, sufficiently in advance; overly late or insufficient communication of supporting documentation may constitute a breach of the duty to inform, and may affect the validity of the relevant board resolutions. In companies with at least 50 employees, the social and economic committee ( comité social et économ- ique ) may attend the meetings in an advisory capacity, and must be informed and consulted on any signifi - cant structural change (including mergers, dispos - als, material changes to production structures, or the acquisition or disposal of subsidiaries) and its environ - mental consequences. In SAs, the board of directors may also implement specialised committees whose role is to issue opin - ions on matters submitted by the board and falling into their competence area. In this case, the board of directors will be convened after the relevant commit - tee and will make decisions based on the committee’s opinion. Decisions of these bodies are made by a vote of the general meeting, which may be held physically, via videoconference, or by postal vote. In this regard, the majority and quorum rules are defined by law or the internal documentation of the company. By exception, and if so provided for in the by-laws, decisions may result from the unanimous consent of the sharehold - ers, expressed in a written act. Decisions are regis -
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