Commentary

Publicis Rethinks Governance Structure

At its annual meeting on May 29 Publicis Groupe will ask shareholders to pass a resolution to do away with its two-tiered board set-up in favor of a single board of directors. 

Under the current two-tiered structure—more common in Europe than the U.S.--the Paris-based holding company has a Supervisory Board and a Management Board, with the latter reporting to the former. 

In theory the management board focuses on day-to-day operations while the supervisory board charts long-term strategy and other non-day-to-day matters. 

Former company CEO Maurice Levy now Chairs the Supervisory Board, while current CEO Arthur Sadoun chairs the management board. Sadoun is not on the Supervisory Board but as CEO of the company I don’t think there is any doubt he focuses on long-term strategy.  

Levy is credited with proposing the restructuring, which was approved unanimously by the Supervisory board. It would take effect after his term expires in 2025, if shareholders go along.  

Once approved, Sadoun would add Chairman of the Board duties to his current CEO role. Levy would take on the new role of Chairman Emeritus. Under the new set-up the company would add an outside Lead Director as well. 

Sadoun and Levy both issued statements saying the change would be the most effective way to sustain the company’s recent growth and success, as well as keeping in place their partnership running the company since 2017.  

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