2010 REGISTRATION DOCUMENT (3.4 Mo) - Groupe Casino

CORPORATE GOVERNANCEChairman’s Report5Processes aiming to protect property and peopleA permanent control process aims to protect property and people. Itis the responsibility of several different departments in each businessunit, and particularly the Technical and Operations departments.Where necessary, they are supported by outside service providersin the areas concerned.Fixed asset managementThe Group’s new construction projects are based on specificationsdrawn up in association with experts. They comply with all applicableregulations and are designed to meet the functional and operationalobjectives of the building. The entire construction process is overseenby a project manager, who ensures that contractual conditions andthe projected budget are met.The Group’s property portfolio is monitored technically andadministratively. Regular maintenance operations are carried out tokeep the properties in an optimal state of repair for their purpose.Business units in charge of a property portfolio may call on the Group’sdedicated subsidiaries if required.Other fixed assets (equipment, fixtures and fittings) are monitored on atechnical level to ensure their correct use and on an accounting levelto ensure the reliability of the basis for calculating various taxes.Banner protectionThe commercial leases signed by business units are drawn up inaccordance with the Group’s requirements to make sure that they haveadequate protection against the risk of eviction. They are monitoredby the teams in charge of property management, whose objective isto renew them on expiry.As a large number of the Group’s stores are run through affiliate andfranchise networks, the relevant contracts are monitored carefullyto ensure that all affiliates and franchisees comply fully with theircontractual obligations.Intellectual property protectionAll trademarks used by Groupe Casino are checked for availabilityand then registered with the appropriate authorities in France andall countries where the Group operates or is likely to operate in thefuture. Each subsidiary monitors its own trademarks to make surethat the requisite registrations are kept up to date.The Group uses outside service providers to make sure that noidentical or similar trademarks are registered by other parties and totake appropriate action in the event of infringement.Image protectionCorporate advertising is the responsibility of Group Communications.Business units with their own communications department work underthe authority and responsibility of Group Communications whereCasino’s image may be affected.Senior Management systematically approves information publishedby Group Communications prior to release, including in the eventof crisis.Intelligence and monitoring processes aim to give the Group themeans to act and react appropriately to published information, inconjunction with the support departments concerned.Merchandise managementThe purchasing strategy, in terms of both assortment and suppliers,is based on market research and reflects the business unit’s mainstrategic goals. Action plans are drawn up on the basis of internal orexternal research to ensure that the product offering always meetsmarket expectations and banner positioning.Controls are regularly carried out to minimise risks relating todependency on suppliers.Lastly, performance indicators are tracked in order to monitor theeffectiveness of the Group’s purchasing processes.The supply chain and logistics teams of each business unit areresponsible for meeting the needs of the Group’s various bannersand for avoiding stock-outs in the stores.The Group Quality Control department sets out the quality policyfor Casino’s private label and similar products. If requested, it willdetermine and/or circulate good product quality and safety practicesfor other business units in order to involve all parties in the Group’squality approach.It draws up and implements quality control and monitoring proceduresfor merchandise and suppliers of Casino private label and similarproducts, budget products and direct imports.Quality audits are carried out at all manufacturing plants of suppliersthat manufacture Casino private label products. In addition, qualityand conformity controls are performed on food and non-food productsby outside service providers.Group business units take measures to safeguard inventories. Thesemeasures include ensuring the security of warehouses, equipment andmerchandise, goods reception and shipping processes, as well asmonitoring standards relating to hazardous or regulated products.Stock-takes are performed regularly, particularly as part of the accountsclosing process. They are designed to monitor a performance indicatorand detect any anomalies in goods flows.Financial asset management and financial flowsThe control activities described below aim to mitigate the marketrisks described in the section of the annual report entitled “Riskfactors – Insurance”.Financial transactions are governed by procedures designed to ensurethe security of cash receipts. There is a system of delegated signatureauthorities for cash payments covering the Group’s business units.Cash receipts and payments are controlled through reconciliationswith bank and accounting data.Financial asset management and control over financing and financialrisk management policies are the responsibility of Group CorporateFinance supported by the subsidiaries’ local Finance departments.Major operations are monitored individually, primarily on the basisof country risk.Group Corporate Finance has produced a guide to good financing,investment and hedging practices, which is circulated to all localFinance departments. The guide sets out financing methods,preferred banking partners, appropriate hedging products andrequired authorisation levels. The Group Corporate Finance Directoris responsible for updating the guide, mainly to take account ofchanges in the Group’s banking partners, which are selected fortheir first-class ratings.Medium and long-term financing transactions and various riskmanagement transactions such as interest rate and currency hedgingare covered by a set of procedures based on prudent, pro-activeprinciples.The Treasury Committee meets weekly to monitor risks, positions andcash forecasts for the Group’s French units, under the supervision ofSenior Management. Treasury risks and positions for the internationalunits are also monitored formally on a weekly basis.Business units conducting banking or insurance businesses areresponsible for ensuring that they comply with the appropriatelegislation.Registration Document 2010 | Casino Group189