231 DECEMBER <strong>2010</strong>Risk Factors and Insuranceregulatory authorities. Provisions are taken to cover these proceedingswhen the Group has a legal, contractual or constructive obligationtowards a third party at the year-end, it is probable that an outflowof resources embodying economic benefits will be required to settlethe obligation, and the amount of the obligation can be reliablyestimated.Information on claims and litigation is provided in notes 26.1 and 33to the consolidated financial statements.As of the Registration Document filing date, the Company is not andhas not been involved in any other governmental, legal or arbitrationproceedings (including any such proceedings that are pending orthreatened of which the Company is aware) during a period coveringat least the previous 12 months which may have, or have had in therecent past, significant effects on the financial position or profitabilityof the Company and/or the Group.Within the framework of litigation with the Baud family, however, asnoted on page 31 in the section on Shareholder Pacts, the Court ofArbitration had not yet ruled on the question of interest on the pricepaid by <strong>Casino</strong> for Franprix-Leader Price shares as well as an eventualright to dividends for the years 2006 and 2007. On 4 February 2011,the Court rejected out of hand the Baud family’s claim for paymentof Franprix and Leader Price dividends for 2006 and 2007. As aresult of this decision, <strong>Casino</strong> will be required to pay only €34 million,corresponding to the Franprix and Leader Price dividends for 2008 andto additional consideration for the Franprix and Leader Price sharespreviously acquired. This amount of €34 million is significantly lessthan the €67 million provision that had been booked in the <strong>Casino</strong>Group’s accounts.2.7.4. INSURANCE—RISK COVERAGEGeneral policyAs in previous years, the main objective of the Group’s insurance policyin <strong>2010</strong> was to protect its assets, customers and employees.The Insurance Department, which reports to Group Finance, isresponsible for:■■■■■managing centralised insurance programmes covering all Frenchoperations (including Mercialys, a listed subsidiary);identifying and quantifying insurable risks;ensuring that subsidiaries comply with the prevention measuresrecommended by the insurance company’s technical departments,particularly those related to facilities open to the public;implementing and monitoring insurance policies and/or selfinsurance;overseeing insurance brokers’ claims management.The Group is assisted by international brokers specialising in majorrisks and also uses the services of insurers specialising in industrialrisks.The Insurance Department oversees the local insurance programmestaken out by foreign subsidiaries where they are not covered by theGroup’s global master policies.Assessment of insurance coverrequirements and related costsSelf-insurance and insurance budgetTo smooth its insurance costs whilst controlling risks, the Groupcontinued to self-insure a large proportion of its high-frequencyclaims in <strong>2010</strong>, mainly but not exclusively for property damage andliability.As well as the application of low traditional deductibles, self-insurancealso includes deductibles per claim capped by underwriting year.These capped deductibles mainly concern major risks such asproperty damage, business interruption and liability. They are pooledat Group level by all subsidiaries insured under the Group’s globalinsurance programme.As well these deductibles, the Group continues to reinsure aportion of its property damage risk through its Luxembourg-basedcaptive reinsurance company, which is consolidated by the Groupand managed locally in compliance with the regulations applicableto this type of company. A stop loss policy is taken out to protectthe captive reinsurer’s interests by capping its commitment andtransferring the financial cost to the insurance market above a certainlevel of claims.Deductibles are managed by insurance brokers and overseen(depending on the type and amount of claim) by the Group as wellas the insurers under their contractual policy obligations.The Group’s total annual insurance budget (premiums and deductibles)for <strong>2010</strong>, excluding group death and disability plans, totalledan estimated €57 million, representing less than 0.20% of <strong>2010</strong>consolidated net revenue.Summary of insurance coverThe insurance cover described below summarises the main policiesvalid during <strong>2010</strong> and as of the date of this report. It cannot in anyway be considered as permanent. It may be changed at any timein accordance with developments in business operations and withthe Group’s choices to take account of insurance market capacity,available cover and rates.Property damage and business interruptionThis policy is designed to protect the Group’s assets.It is a ’named exclusion’ policy (i.e. it covers all losses exceptthose explicitly excluded) based on cover available in the insurancemarket.Insured risks include but are not limited to fire, explosion, naturaldisasters, subsidence and electrical damage.The maximum sum insured is €220 million per claim for major claims(fire and explosion), including direct damage and business interruption.There are certain sub-limits for named risks, including natural events,subsidence and theft.The premium payable on 1 July <strong>2010</strong> went up due to the riots andsocial unrest in Thailand in April <strong>2010</strong> which resulted in serious firedamage to a Bangkok shopping centre, and to the floods in theVar département of France in June <strong>2010</strong>. However, the increasewas contained thanks to the Group’s effective self-insuranceprogramme.No major claims had occurred by the year-end which could have anadverse effect on the programme’s renewal on 1 July 2011, either interms of overall cost (premiums and deductibles) or the cover itself.42 <strong>Casino</strong> Group | Registration Document <strong>2010</strong>
31 DECEMBER <strong>2010</strong>Environmental Report2LiabilityLiability insurance covers the Group for all losses that might be incurreddue to bodily injury, damage to property or consequential loss sufferedby third parties caused by the Group’s products sold or delivered,technical facilities and equipment, buildings, store operations andservices rendered.The current policy is also a ’named exclusion’ policy with a sub-limitof €76 million for product withdrawal costs and for employer’s liabilityfor occupational accidents and illness.<strong>Mo</strong>st of the Group’s premises are classified as facilities open to thepublic. Insurance of the related risks requires careful managementgiven the involvement of third parties.Other insurance required by lawIn light of the Group’s business activities, it also has the followinginsurance cover:■■■■motor insurance;damages to works (prefinancing of claims under the ten-yearwarranty);construction insurance (ten-year warranty);specific liability insurance (building owners’ association or propertymanager, travel agency, bank).Other insuranceThe Group has also taken out various other policies given the risksinvolved, including:■a worldwide transportation and import policy to cover domesticand international transportation of goods;■a comprehensive contractor liability insurance to cover damageto buildings under construction, redevelopment, extension orrefurbishment.Risk prevention and crisis managementThe Group’s risk prevention policy, particularly with regard toproperty damage, which has been in place for several years now,is based on:■■■■regular audits of high value facilities by the insurers’ technicaldepartments, mainly covering hypermarkets, shopping centresand warehouses;joint monitoring of the audit and prevention reports for each facilityby the technical departments of both the Group and its insurers;monitoring of the protection in place at each facility according toneed and priorities (e.g. sprinklers, safety and security installations,etc.);monitoring risk mapping, including natural or other events both inFrance and abroad.The Group maintains and pursues a preventive approach to productrisk upstream of the sales outlets, both for private label and brandedgoods.In the event of a crisis or major claim, it also has the technical andadvisory resources to take swift action as required to protect itspeople, safeguard its assets and, wherever possible, ensure continuityof business and customer service.2.8. ENVIRONMENTAL REPORT2.8.1. SCOPEThe environmental data presented below includes all Géant <strong>Casino</strong>,<strong>Casino</strong> Supermarché, Hyper <strong>Casino</strong>, Spar and Petit <strong>Casino</strong> stores(including the Corsican stores managed by the Group’s subsidiaryCodim 2), the <strong>Casino</strong> cafeterias, the Easydis warehouses andCdiscount.Data concerning <strong>Mo</strong>noprix (50%-owned) are presented separatelyin the tables below.Data concerning the franchise outlets are not included in the <strong>2010</strong>report.Data concerning the Franprix-Leader Price Group are presentedseparately and only cover the consolidated scope, i.e. a total of167 Franprix outlets and 259 Leader Price outlets.Additional information, including data on foreign subsidiaries, isavailable in the <strong>Casino</strong> Group’s <strong>2010</strong> Business Review and CorporateSocial Responsibility (CSR) Report and the <strong>Mo</strong>noprix BusinessReview.2.8.2. ENVIRONMENTAL MANAGEMENTEnvironmental policyIn 2003, the <strong>Casino</strong> Group adopted a formal environmental policyset out in an action plan called “Excellence verte”. Each year, anenvironmental seminar is held for all environment officers in the Group’svarious functions and subsidiaries in France to review the effectivenessand results of actions taken and to set out the environmental actionplan for subsequent years. The plan is “Factor 4” compliant underthe French government’s Grenelle de l’environnement programmeand addresses all environmental issues including energy, waste,transportation, water, sustainable construction, eco-design, etc.Detailed road maps are available in the <strong>2010</strong> Business Review andCSR report.<strong>Casino</strong> completed its second carbon report in 2009 in order to refineits action plan and update its carbon index for <strong>Casino</strong> productslaunched in June 2008. The index covered more than 630 productsat end <strong>2010</strong>. <strong>Casino</strong> continues to work on environmental labelling inpartnership with the Ademe and Afnor organisations and submitteda response to the tender invitation launched in <strong>2010</strong> by the FrenchMinistry of Ecology, Energy, Sustainable Development and MaritimeAffairs.Registration Document <strong>2010</strong> | <strong>Casino</strong> Group43