The Board of Directors of Compagnie Financière Richemont SA, the parent company, is responsible for the overall strategic direction of the Group and the appointment of senior management. In addition, it is responsible for establishing financial controls and appropriate procedures for the management of risk within the Group as well as the overall supervision of the business. The Board is responsible for the preparation of the financial statements of the Company and of the Group and for the organisation of the annual meeting of shareholders.
The Board is composed principally of non-executive directors with diverse professional and business backgrounds. Nine nationalities are represented on the Board, which was composed of 13 members at 31 March 2005. Board members are elected at each year's Annual General Meeting for a term of one year.
In terms of its regular business, the Board generally meets for half a day to a full day, five times per annum. Further meetings on specific topics are held on an ad hoc basis. The Board also meets with executive management for two days each year to review the strategic direction of the Group's businesses. The Executive Chairman, Group Chief Executive Officer and Group Finance Director establish agendas for meetings of the Board, financial reports and supporting information in respect of agenda items being circulated to members of the Board in advance of each meeting. Directors may ask that an item be placed on the agenda for any meeting.
At the annual meeting of shareholders of Compagnie Financière Richemont SA held on 16 September 2004, Mr Richard Lepeu, Group Finance Director, was elected to the Board of the Company, following the resignation of Mr Jan du Plessis in April 2004 from the Board of Compagnie Financière Richemont SA and of Richemont SA to allow him to take up the position of Chairman of British American Tobacco p.l.c. Mr Norbert Platt, appointed as the Group Chief Executive Officer in September 2004, has been nominated to the Board of Compagnie Financière Richemont SA, subject to the approval of shareholders at the Annual General Meeting to be held in September 2005.
Ms Martha Wikstrom has been nominated to the Board of Compagnie Financière Richemont SA,subject to the approval of shareholders at the Annual General Meeting to be held in September 2005. Ms Wikstrom has a background in the acquisition and development of luxury and lifestyle brands and is a Non-Executive Director of Bally International Ltd.
During the year under review three directors of Richemont SA resigned from that company's Board. In addition to Mr Jan du Plessis, Dr Franco Cologni retired from his executive role within Richemont SA in November 2004. He continues to serve as a director of Compagnie Financière Richemont SA and remains a member of Richemont's Strategic Product and Communication Committee. Ms Isabelle Guichot resigned from her position as Chief Executive Officer of Van Cleef & Arpels and of Lancel and from the Group's management board and left the Group in January 2005, in order to diversify her experience in an external organisation.
Since the year end, two further directors of Richemont SA have resigned from the Board of that Company and one new appointment has been made. Ms Dominique Jousse, Human Resources Director, resigned from the Board and left the Group in April 2005, and Mr Yannick Lakhnati, Chief Operating Officer, resigned and left the Group in May 2005. At a meeting of shareholders of Richemont SA held in June 2005, Mr Thomas Lindemann, Group Human Resources Director, was appointed to the Board of that Company.
Mr Simon Critchell resigned from his position as Chief Executive Officer of Alfred Dunhill in June 2005 but will remain a member of the Richemont SA Board until 31 March 2006.
In terms of the Group's framework of corporate governance, the Board of Compagnie Financière Richemont SA has established an Audit Committee, a Compensation Committee and a Nominations Committee. The composition of these Committees is indicated in the biographical notes on Board members set out below. No corporate governance committees have been established by the Board of Richemont SA,Luxembourg, given its role as the Group's management board.
The four members of the Audit Committee are non-executive directors. The Group Finance Director attends all meetings, as do the Head of Internal Audit and representatives of PricewaterhouseCoopers SA,the Group's external auditors. Meetings of the Committee are held at least three times per annum. The Committee meets in camera with the external auditors during the course of each meeting. The Audit Committee's principal tasks are to:
The Compensation Committee comprises three non-executive directors. To assist it in its deliberations it may draw on support from the Group's internal specialists and external advisors. Meetings of the Committee are held as necessary but at least twice per annum.
The function of the Committee is to establish a framework for determining the remuneration of Group executives and to establish the remuneration to be paid to non-executive directors and key executive directors.
The Committee also approves awards to the senior management group in respect of the Group's stock option plan.
The Nominations Committee consists of the non-executive directors meeting under the chairmanship of the Executive Chairman.
The principal functions of the Committee are to advise the Board of Compagnie Financière Richemont SA in areas such as the composition and size of the Board and the criteria to be applied in the selection of new members of the Board and management.
In addition, the Committee is responsible for the nomination of directors to serve on board committees and the management board.
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Johann Rupert South African, age |
Mr Rupert studied economics and company law at the University of Stellenbosch, South Africa and has had an extensive career in international business and finance. He has served on the boards of Rothmans International and British American Tobacco and was Executive Chairman of Rand Merchant Bank. He became Group Chief Executive of Richemont on its formation in 1988 and assumed the role of Executive Chairman in September 2002. He further served as Group Chief Executive Officer during the period from October 2003 to September 2004. He is Non-Executive Chairman of Remgro Limited and of VenFin Limited. Mr Rupert is Chairman of the Nominations Committee.
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Jean-Paul Aeschimann Swiss, age |
MaÎtre Aeschimann graduated in law from the University of Neuchâtel, studied at Harvard University and has been admitted to the Bar of Geneva. He is a practising lawyer and is a senior partner of Lenz & Staehelin, based in Geneva. He serves on the board of Barclays Bank (Suisse) S.A. as well as a number of Swiss subsidiaries of the Total group. Lenz & Staehelin acts as legal counsel to Richemont and to Compagnie Financière Rupert and Maître Aeschimann is the Special Auditor of Compagnie Financière Rupert. Maître Aeschimann is Chairman of the Audit Committee and is a member of the Compensation Committee and the Nominations Committee.
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Franco Cologni Italian, age |
Dr Cologni is a graduate of the University of Milan, where he later became a professor. As a writer, he has published several books and articles, in particular on luxury goods, jewellery and watches, and is the publisher and editor-in-chief of the "Cartier Art" magazine. He joined Cartier in 1969 and served as Managing Director and Chairman of Cartier International. Dr Cologni has also been closely involved with the Group's watch brands and serves as Chairman of the Supervisory Board of the Comité International de la Haute Horlogerie. He is founder of the Richemont Creative Academy which offers Masters degrees in design and creative management. Dr Cologni is a member of the Strategic Product and Communication Committee of the Group.
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Richard Lepeu French, age |
Mr Lepeu is a graduate of the Institut d'Etudes Politiques de Paris and the Université de Sciences Economiques de Paris X. He worked in international corporate finance before joining Cartier in 1979 as assistant to the President. Within Cartier, he was appointed Company Secretary in 1981 and became Director of Finance and Administration in 1985 before being appointed Chief Executive in 1995. He became Chief Operating Officer of Richemont in 2001 and was appointed as Group Finance Director in May 2004. Mr Lepeu is also a member of the Boards of Richemont SA,Richemont Japan and Richemont North America.
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Leo Deschuyteneer Belgian, age |
Mr Deschuyteneer is a graduate in economics and holds a doctorate in law from the University of Brussels. He was a Fullbright scholar and holds an MBA from Temple University of Philadelphia. He has participated in the Advanced Management Program at INSEAD. He is an active partner in the management of Sofina SA,a Belgian investment company, which is an investor in Richemont. He has been involved with Richemont's luxury goods businesses for a number of years, having previously served as a director of Vendôme Luxury Group. He is also a director of various European companies, including Sidro, Sofindev, Colruyt, Cerepfi and Mecaniver and is a member of the Executive Committee of the Belgian National Theatre. Mr Deschuyteneer is a member of the Audit Committee and the Nominations Committee.
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Lord Douro British, age |
Lord Douro holds an MA degree from Oxford University. He has broad experience in banking and finance and served previously as Chairman of Dunhill Holdings and as Deputy Chairman of Vendôme Luxury Group, which were subsidiaries of the Group. He was a member of the European Parliament from 1979 to 1989 and was Chairman of Sun Life and Provincial Holdings from 1995 to 2000. He is currently Chairman of the Framlington Group and is a director of Sanofi-Aventis and of Pernod Ricard and is a Commissioner of English Heritage. Lord Douro is a member of the Nominations Committee.
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Yves-André Istel American, age |
Mr Istel graduated in economics from Princeton University and has had an extensive career in investment banking. He was Managing Director and a member of the board of Lehman Brothers from 1977 to 1983; Co-Chairman of First Boston International from 1984 to 1988; Chairman of Wasserstein Perella & Co International from 1988 to 1992; and Vice Chairman of Rothschild Inc from 1993 to 2002. He is currently Senior Advisor to Rothschild Inc and a member of its Investment Banking Committee. He is a director of the boards of Imperial Sugar Company, Valeo S.A., GenuOne Inc, and Tiedemann Trust Company and a member of its Investment Committee and its Trust & Investment Committee. He is a member of the advisory board of Healthpoint Partners. In addition, he is Chairman of the advisory board of the Remarque Institute, New York University; the Center for French Civilisation and Culture, New York University; The European Institute; and Fondation Saint-John Perse. He is also a member of the board of the French-American Foundation; the Council on Foreign Relations and Action Against Hunger, USA; the Board of Overseers, New York University and the Advisory Council in the Department of French and Italian, Princeton University. Mr Istel is a member of the Audit Committee and the Nominations Committee.
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Simon Murray British, age |
Mr Murray was educated at Bedford School in England and attended SEP Stanford Business School in the United States. He began his business career at Jardine Matheson, with ultimate responsibility for the company's engineering and trading operations, as well as holding directorships in various affiliated companies. In 1980, he formed his own project advisory company mainly involved in financing capital-intensive engineering projects in the Asia-Pacific region. He subsequently became the Group Managing Director of the Hong Kong based conglomerate Hutchison Whampoa. He pioneered that company's entry into the mobile telecommunication business and developed its energy business. He joined Deutsche Bank Group as Executive Chairman Asia-Pacific in 1993, supervising the Group's operations in the region. He subsequently founded Simon Murray & Associates and its subsidiary General Enterprise Management Services Ltd, a private equity investment management company. Mr Murray is a member of the Nominations Committee.
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Alain Dominique Perrin French, age |
Mr Perrin is a graduate of the Ecole des Cadres et des Affaires Economiques, Paris (E.D.C.). He joined Cartier in 1969, assuming a series of roles in that organisation and served ultimately as President of Cartier International SA. He has been responsible for the creation of the Fondation Cartier pour l'Art Contemporain in Paris and the launch of the annual Salon International de la Haute Horlogerie. He serves on the management committees of a number of non-profit organisations and is President of the Ecole de Dirigeants et Créateurs d'entreprise (E.D.C.). Mr Perrin was Chief Executive of Richemont SA overseeing the Group's luxury goods business from 2001 to 2003.
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Alan Quasha American, age |
Mr Quasha is a graduate of Harvard College, Harvard Business School, Harvard Law School and New York University Law School. After practising law he moved into commerce and is now President of Quadrant Management Inc, an investment management business based in New York. He served as a director of Richemont SA,Luxembourg from 1988 up until the time he joined the Board of Compagnie Financière Richemont SA and was Chief Executive Officer of North American Resources Limited, formerly a joint venture between Richemont and the Quasha family, between 1988 and 1998. He is also Chairman of Harken Energy Company, Chairman of Carret Asset Management Group LLC and a past director of American Express Funds. He is a past governor of the American Stock Exchange, is Chairman of the Visiting Committee of Harvard University's Weatherhead Centre for International Affairs and is Chairman of the American Brain Trauma Foundation. Mr Quasha is a member of the Nominations Committee.
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Lord Renwick of Clifton British, age |
Lord Renwick is a graduate of Cambridge University and served in the British diplomatic service, rising to become Ambassador to South Africa from 1987 to 1991 and Ambassador to the United States from 1991 to 1995. He is currently Vice Chairman, Investment Banking of JPMorgan Europe and of JPMorgan Cazenove. He is Chairman of Fluor Limited and a director of BHP Billiton, British Airways, Fluor Corporation and SABMiller. He is also a trustee of The Economist. Lord Renwick is Chairman of the Compensation Committee and is a member of the Audit and Nominations Committees.
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Jürgen Schrempp German, age |
Prof. Schrempp holds a degree in mechanical engineering from the University of Applied Science in Offenburg, Germany. He is Chairman of the Board of Management of DaimlerChrysler AG and is one of the principal architects of Daimler-Benz's successful 1998 merger with Chrysler Corporation. During his over 40 years with the company, Prof. Schrempp served as President of Mercedes-Benz of South Africa, Deputy Board Member of Daimler-Benz AG responsible for Commercial Vehicles and Chairman of the Board of Management of Daimler-Benz Aerospace AG. He was named Chairman of Daimler-Benz AG in 1995. Prof. Schrempp is a Non-Executive Director of Sasol Ltd. and Vodafone Group plc. He is Chairman of the Southern Africa Initiative of German Business and a member of the South African President's International Investment Council. Additional positions include membership of the Advisory Board of Deutsche Bank AG, the European Advisory Board of Harvard Business School and the German Council of INSEAD. Prof. Schrempp holds a Professorship of the Federal State of Baden-Württemberg, Germany, an honorary Doctorate of the University of Graz, Austria, and an honorary Doctorate of Commerce (H.C.) of the University of Stellenbosch, South Africa. He is a member of the Nominations Committee.
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Ernst Verloop Dutch, age |
Mr Verloop holds a degree in law from Utrecht University. He enjoyed a long and successful international career with the Unilever group, rising to become an executive director of Unilever NV and Unilever PLC. He has served on the boards of a number of leading Dutch and international companies, associations and state enterprises and was Chairman of the Unilever-Erasmus University Visiting Professorship in Marketing Foundation. He was Chairman of the Supervisory Board of Rothmans Europe (Nederland) BV and was a director of Rothmans International BV when those companies were subsidiaries of the Group. He is currently Chairman of the Central Museum Committee of Utrecht. Mr Verloop is a member of the Nominations Committee and the Compensation Committee.
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