4.2 CSR – key priorities, stakeholders and responsible corporate governance

Create purpose. Foster personal fulfilment at work. Offer guidance to employees in diversity and innovation. Combine excellence with corporate responsibility. Anticipate the needs of a changing society. Align respect for objectives with respect for the planet. These challenges are directly related to the Lagardère group’s businesses and are reflected in the commitments made as part of its Corporate Social Responsibility (CSR) policy designed to achieve three primary objectives: comply with increasingly stringent regulatory requirements, align the approach with the Group’s evolving strategy and structure, and strengthen stakeholder relations.

4.2.1 CSR POLICY OBJECTIVES

A) COMPLYING WITH INCREASINGLY STRINGENT REGULATORY REQUIREMENTS

The CSR reference framework applies internationally.
In France, non-financial disclosure requirements have become stricter over the years. This section represents the Group’s non‑financial statement, to be published pursuant to articles L. 225-102-1 and R. 225-105 of the French Commercial Code. It also contains the duty of care plan, which is obligatory for parent companies and contracting entities (see section 4.7). Regarding tax evasion, the Group takes a responsible approach to tax matters to support its business operations, paying taxes where its economic activities take place. The Lagardère group also takes steps to comply with international requirements, such as country-by-country reporting (CBCR), and undertakes to provide the utmost transparency in its dealings with tax authorities.
In application of its tax policy, Lagardère ensures that no Group business aims to transfer profits to tax havens. Intangible assets are located in countries where its economic activities take place.
Internationally, Lagardère applies a number of core CSR documents and principles, such as the International Bill of Human Rights, the ILO’s Fundamental Principles⁽¹⁾, the OECD⁽²⁾ Guidelines for Multinational Enterprises, and the Guiding Principles on Business and Human Rights.
The Lagardère group draws on other guidelines in carrying out its business activities, including ISO 26000 (used as a basis for updating the 2012 Code of Conduct), Unesco’s Convention on the Protection and Promotion of the Diversity of Cultural Expressions and Unicef’s Implementation Handbook for the Convention on the Rights of the Child.
Lastly, the UN’s Sustainable Development Goals (SDGs) – formulated in 2015 and setting out the societal priorities for building a more sustainable society – have become the reference for CSR best practice. Accordingly, the Group endeavours to build a strategy consistent with those goals that are most relevant to its businesses. Broken out into 17 global development goals on wide-ranging topics including gender equality, climate action, quality education and innovation, the SDGs cover all of the core sustainability priorities for the period through to 2030. They set out a clear framework of standards and shared language for all stakeholders, ensuring synergy and consistency in actions and initiatives at all levels. As in previous years, the Group’s General and Managing Partner Arnaud Lagardère is renewing his commitment to the principles of the United Nations Global Compact, to which the Group has adhered since 2003 and which have guided its CSR strategy for the past sixteen years.

Items appearing in the Annual Financial Report are cross‑referenced with the following symbol AFR

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⁽¹⁾ International Labour Organization.
⁽²⁾ Organisation for Economic Co-operation and Development.

With operations on every continent, the Lagardère group is one of the world’s leading publishing and travel retail businesses. As an international Group, we need to be rigorous and exemplary in promoting rights and principles that are universally recognised and adopted to ensure that globalisation is respectful of humankind and the environment. This international commitment is expressed through the Group’s membership of the United Nations Global Compact, which we joined in 2003, and which encourages businesses to operate responsibly. To reaffirm our commitment, each year we report on the progress made by our Group in the Compact’s ten principles.

HUMAN RIGHTS
Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights.
Principle 2: Businesses should make sure that they are not complicit in human rights abuses.

LABOUR
Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining.
Principle 4: Businesses should uphold the elimination of all forms of forced and compulsory labour.
Principle 5: Businesses should uphold the effective abolition of child labour.
Principle 6: Businesses should uphold the elimination of discrimination in respect of employment and occupation.

ENVIRONMENT
Principle 7: Businesses should support a precautionary approach to environmental challenges.
Principle 8: Businesses should undertake initiatives to promote greater environmental responsibility.
Principle 9: Businesses should encourage the development and diffusion of environmentally friendly technologies.

FIGHTING CORRUPTION
Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery.

Arnaud Lagardère
General and Managing Partner of Lagardère SCA

B) ADAPTING CSR TO GROUP STRATEGY AND DEVELOPMENT
The Lagardère group aligns its CSR policy with its development strategy for its various businesses. For several years, the CSR roadmap has therefore paid special attention to:

• changes in the Group’s activities. The development of activities offering growth potential, as well as changes in the business models of the more historical activities, to the extent that innovation is an essential component that affects the social, environmental and societal impacts of the Group’s activities;
• the Group’s increasingly international footprint. The international expansion of the Lagardère group’s activities, entry into new emerging markets and the objective of ensuring that growth becomes less centred on France are also factors to bear in mind since they alter the contours of the Group’s CSR strategy (inclusion of issues with an international reach, impacts on local communities, promotion of cultural diversity, etc.).

C) STRENGTHENING STAKEHOLDER RELATIONS
Authors and other artists, readers and listeners, employees and suppliers, concession granters and the travelling public, customers and investors, consumers and shareholders: Lagardère’s various stakeholders – internal, external, public and industry – are mapped out in the chart below.
Since it first launched its CSR strategy, Lagardère has maintained frequent and ongoing dialogue with non-financial investment analysts. This long-term commitment, together with the steady year-on-year progress, has enabled the Group to feature in the following ESG indexes (as at 31 December 2019): Vigeo Euronext Europe 120 and Eurozone 120, FTSE4Good Index Series, Ethibel Sustainability Index (ESI) Excellence Europe and STOXX® Global ESG Leaders Index. On the back of its strong performance in the 2019 Dow Jones Sustainability Index review, the Lagardère group was also included in the Sustainability Yearbook 2020, placing it among the six leaders in its peer group.
To build on its objective to enhance dialogue with stakeholders, in 2015 Lagardère set up a stakeholder panel, an advisory body that seeks to continuously improve the Group’s CSR practices. Lagardère’s stakeholder panel is chaired by Thierry Funck- Brentano, one of the Co-Managing Partners of Lagardère SCA, and coordinated by the Sustainable Development and CSR Department. Its 12 members – 11 of which are external to the Group – are appointed for two years and represent the Group’s main priorities, business lines, and industries.

The panel has three main goals:

• establishing regular dialogue at Group level between Lagardère and its stakeholders;
• obtaining a better understanding of stakeholders’ perception and expectations of the Group;
• supporting Lagardère’s forward-looking strategy for its main social, environmental and societal priorities.

This ongoing stakeholder dialogue was given its full meaning in 2017, when the Lagardère group produced its first materiality matrix and updated its CSR roadmap.
After determining the initial qualitative and quantitative methodology, the final matrix, shown below, was fine-tuned with the aim of simplifying the overall CSR roadmap. The last step involved presenting the matrix to the stakeholder panel.

4.2.2 CSR PLAYERS AND GOVERNANCE

At Group level, the Sustainable Development and CSR Department, which reports to the Managing Partners, coordinates a Steering Committee comprising CSR managers from each business line and representatives from several cross-functional departments. Chaired by the Group’s Chief Human Relations, Communications and Sustainable Development Officer, who is also a Co-Managing Partner of the Lagardère group, this Committee fine-tunes the Group’s CSR strategy and proposes initiatives to be undertaken at Group level while promoting the sharing of best practices between the divisions. The Group-level CSR policy has been adapted to the purposes of each division. It is implemented by a divisional Sustainable Development manager, who coordinates the networks of internal correspondents, organises local steering committees and rolls out the tools required to embed CSR policies deeply into its business activities.
In parallel, the Sustainable Development and CSR Department steers the various working groups dealing with key issues in liaison with the corporate functions. It also coordinates dialogue with the stakeholder panel. Since 2015, the Supervisory Board has incorporated CSR within the duties of the Appointments, Remuneration and CSR Committee. In 2019, the Sustainable Development and CSR Department updated the Supervisory Board on the CSR roadmap as well as presenting Lagardère’s ESG ratings. Responsible corporate governance forms the basis of the Lagardère group’s CSR roadmap. The Group’s approach to responsible corporate governance is reflected in its ethical principles and in compliance programmes applicable to employees (see section 3.2.6.5).
The Lagardère Group Code of Conduct, for which the update process was launched at the end of 2019, comprises a series of guidelines underpinning the values shared by all Lagardère employees. The Code of Conduct is one of the core documents used to define the Group’s CSR policy.

Lagardère group materiality matrix

4.2.3 CSR ROADMAP

The CSR roadmap is centred around three key principles:

• Placing people at the heart of our strategy
  This represents our core responsibility to employees, namely that we should provide them with a diverse, varied, attractive and stimulating environment in which to work.
• Reducing the environmental impact of our products and services
  Above and beyond the responsibility that comes with producing content – to inform, raise awareness, educate, and provide tools through which to understand the world – the Lagardère group works towards a pragmatic, environmentally-driven commitment that is relevant to its business activities, by focusing on three fronts: climate change, responsible resource management and an environmentally responsible approach to the food chain.
• Sharing the social and cultural diversity of our businesses
  The Lagardère group promotes access to education and knowledge while defending freedom of speech, pluralism of ideas and cultural diversity through the content it produces and distributes, as well as through its various partnerships and cultural and social solidarity programmes.

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