FRANCE Law and Practice Contributed by: Jean-Christophe Devouge and Kaïs Boussadia, Aurès
of Payments to Directors/Officers will only deal with one-tier board SA. SA boards of directors are composed between three and eighteen directors, including the chair - man of the board. The shareholders appoint the directors, which may be natural or legal persons. In the latter case, they must appoint a perma - nent representative to the board. Regulations and recommendations apply to the selection of directors: • diversity rules require boards of directors of companies having more than 250 employees to have a proportion of directors representing each gender at the board of at least 40%; • larger companies must appoint directors representing the employees or shareholders’ employees; and • corporate governance codes recommend that a sizable proportion of directors are inde - pendent. The board of directors may set up specialised committees (audit committee, compensation committee, ESG committee, etc), whose role is to issue opinions on matters submitted by the board in order to improve the effectiveness of the board. Specialised committees have consul - tative powers only and are not a substitute for the board. Audit committees are mandatory for companies whose shares are admitted to trading on a regulated market. The shareholders may also appoint censors to the board of directors, with an advisory role only. SAS In SAS, the structure of the board – if the share - holders decided to voluntarily set up such col -
legiate body – is freely set in the by-laws or inter - nal rules adopted by the shareholders, if any. SARL There is no board of directors in SARL, as the management is exclusively performed by its manager(s). 4.2 Roles of Board Members The board of directors is a collegiate body. As a principle, the directors collectively exercise the functions assigned to the board and they do not have any individual powers, except for the chair - man of the board. However, the board of directors may grant specific assignments to individual directors, in order to improve the corporate governance of the company and facilitate the board’s mission. Directors may be assigned, given their skills and experience, to one or more specialised commit - tees to help assess specific matters (please refer to 4.1 Board Structure ). Also, the board of directors may appoint a lead director chosen from among the independent directors to play a mediating role between the board of directors and the shareholders and improve shareholder dialogue. Lead directors are strongly recommended by the AFEP-MEDEF Code in a controlled listed company. The chairman of the board has a distinct role: they are in charge of organising and directing the work of the board of directors and reporting to the general meeting. The chairman ensures the proper functioning of the company’s bodies and that the directors are able to fulfil their duties.
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