FRANCE Law and Practice Contributed by: Jean-Christophe Devouge and Kaïs Boussadia, Aurès
Supervisory Functions In elaborate forms of companies, specific bod - ies are responsible for supervising management, whereas in other forms of companies, manage - ment control is left to the shareholders. In SA with a one-tier board system, the board of directors is a hybrid corporate body as it is in charge of supervisory functions over corporate officers, as well as certain management func - tions (please see below). Most supervisory func - tions are assigned to the supervisory board. In other corporate forms (SAS, SARL), super - visory functions are performed, in a more lim - ited way, directly by the shareholders and no dedicated corporate body is provided by law. However, the shareholders may decide, in SAS, to create specific corporate bodies and entrust them with supervisory powers. Management Functions Management functions include the definition and implementation of the company’s strategy and the representation of the company towards third parties. Depending on the corporate form of the company, management functions are exercised by individuals or collegiate bodies. SA may be structured pursuant to a one-tier board or a two-tier board system, at the share- holders’ discretion. This choice must be regis - tered in the by-laws. In SA with a one-tier board system, the man - agement functions are split between the board of directors, whose members are appointed by the shareholders, the chairman of the board of directors, appointed by the board among the directors, and the CEO ( directeur général ), also appointed by the board of directors. The board of directors may also decide to name a single
person to act as chairman and CEO ( président- directeur général ). The board of directors, upon request of the CEO, may appoint one or more deputy CEOs to assist the CEO and delegate management powers to them. In SA with a two-tier board system, the manage - ment functions are entrusted to the executive board ( directoire ), appointed by the supervisory board. Members of the executive board are not allowed to be part of the supervisory board. In SAS, the law entrusts the chairman ( prési- dent ) with all management functions. The chair - man may be a natural or a legal person. The shareholders are free to provide for additional corporate bodies in the by-laws, entrusted with limited management functions. SARL are managed by one or more managing directors ( gérants ). The managing directors are natural persons. 3.2 Decisions Made by Particular Bodies The powers and types of decisions made by the corporate bodies differ depending on the corpo - rate form of the company. Please refer to 5.2 Role of Shareholders in Company Management for a description of the shareholders’ decision-making powers. SA In one-tier board systems, the board of directors is competent to determine the strategic orien - tations of the company’s business and ensure their implementation within the limits of the company’s interest and taking into considera - tion social and environmental issues. In particu - lar, the board of directors:
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