PPR - Supporting employees

Interactive 2007 Annual report: part CSR

PPR’s commitment, as a socially-responsible Group, is to reconcile effectively economic performance, social accountability and preservation of the environment. Relying on its entrepreneurial expertise, the Group is developing innovative sustainable-development initiatives.

Our appropriation of this concept is manifested in an approach based on corporate social responsibility (CSR approach) deployed across all the Group’s retail companies, and governing an ambitious, ground-breaking, many-faceted policy. A particular structuring feature of the CSR policy pioneered and developed by PPR is the Code of business practices, a frame of reference underpinning good conduct by all the Group’s brands.

A decentralised organisation with a focus around two core activities – retailing and luxury, PPR deploys all necessary actions to enable each retailing company, in keeping with its specific concerns and features, its business line, commitments and culture, to institute socially and environmentally responsible projects in harmony with the Group’s general policy and spirit in this area.

2006 was marked by the strengthening of the key developments and strategies initiated in previous years, the priority being the continued deployment and monitoring of the correct application of the PPR Code of Business Practices. The real backbone of PPR’s CSR policy, the Code formalises the Group’s commitments vis-à-vis :

- its employees ;

- environment ;

- its customers ;

- its partners ;

- society ;

- its shareholders.

Appraisal

At the beginning of each year, PPR and its companies organise annual performance appraisal interviews, which are opportunities for managers and employees to discuss the past year's performance and the objectives for the forthcoming year.

In 2006, all executives and most employees in the Retail division companies based in France had this annual performance appraisal interview. To promote exchanges, Redcats focused in 2006 on the annual performance interview by breaking it down into two key phases: the Performance review and the Development review.

In each company, the key issues arising from executive appraisal interviews (e.g. potential mobility) are (then) consolidated and analysed by Human Resources and managers during People reviews.
These feedback and monitoring processes are used to initiate training plans adapted to the needs of the company and employees and facilitate internal mobility.

Group executives benefit from an additional appraisal and development tool. Hence, every two years, PPR's 130 managers benefit from a 360° feedback on the perception of their management. This feedback is provided by their hierarchy, peers and members of their teams.

Development of employee skills

In 2006, each company deployed rich and varied training and development measures, particularly through the 941,201 hours of training provided (excluding safety training), enabling their employees to develop their level of expertise. CFAO also set up intercultural training in order to facilitate the running of international teams.

The Group's Human Resources Department proposes supplementary training at head office level in addition to that conducted within each company. Young Group managers (proposed by each company) can therefore take part in the Development center programme, enabling them to identify their professional strengths and build with their human resources manager a personalised career development plan.

The Group's Human Resources Department also rolled out specific programmes, Leadership Programs, for company executives to ensure their development around 4 major issues:

- Develop a global vision;
- Anticipate and manage change;
- Mobilise the collective and individual commitment; and

- Deliver performance.

In total, more than 220 persons participated in the training programmes developed by the Group's Human Resources Department in 2006.

Remuneration and employee benefits

Remuneration policy

Due to the specificity of the businesses and the Group's decentralised operations, the remuneration policy is defined at company level according to the principles of fairness and external competitiveness defined by PPR.
The performance appraisal process set up in the Group helps strengthen the link between performance and remuneration. For example, Fnac, as part of its 2007-2011 business project, will extend the individual variable remuneration system to all vendors. The aim is to boost individual performance while maintaining the spirit of solidarity and total independence vis-à-vis suppliers.

Supplementary health, death and disability and pension coverage

In 2006, 49,986 employees on permanent contracts benefited from additional employee protection over and above the legal obligation, i.e. 72.4% of employees on permanent contracts (81.7% of managers and 70.1% of non-managers), compared to 71.2% in 2005.

In 2006, the measures implemented to limit the losses of certain schemes and improve guarantees were continued. Thus, Redcats set up a disability/invalidity cover for those employees and workers not yet covered in all its companies. Likewise, CFAO amended its accident insurance contract in France so that all its employees may benefit from death insurance cover with a spousal pension.

Other advantages

Under the legal mechanisms prevailing in France, nearly 100% of PPR’s French Retail division employees benefit from the profit sharing through incentives and 69% through profit-sharing schemes.

Most of the Group’s companies in France have Employee Saving Plans (Plans d’epargne entreprise - PEE) which are designed to collect profit-sharing and, depending on the company, incentives, voluntary contributions from employees and any employer’s matching contributions.

The Luxury Goods division employee card offers the employees in this division preferential purchase conditions for all Gucci Group brand products. Likewise, the Retail division employee card offers preferential purchase conditions to each PPR employee in the Retail division located in France and certain European countries.