Reforming Sacem's Statutes Governance, Ethics and Transparency

Sacem is committed to being truly in touch with, and better satisfying, our members' needs.

As it constantly strives to become more efficient, Sacem makes it a point of honour to be as transparent as possible in its management and governance and 2017 sets a new course for this journey. In order to comply with the recent ruling delivered on 22 December 2016, Sacem is sprucing up its statutes and embarking on an unavoidable revolution at the service of authors, composers and publishers.

Our statutes are the backbone of our society. They set out the fundamental rules and guarantees that ensure it functions correctly. Sacem's statutes were created at the same time as Sacem, but have evolved over the years to adapt to new regulations and changing contexts. It has been some time, however, since an in-depth overhaul has been undertaken.

This statutory reform, to be tabled on 1 March 2017, complies with the ruling of 22 December 2016 transposing the European Directive of February 2014 pertaining to collective management.
It will be one of those major reforms that leave their mark and open a new chapter. The reform is exclusively linked to the European Directive.
Sacem is grasping this opportunity, provided by the obligation to become compliant with the law, to add even more services for its members and afford greater clarity to its actions. The key words of the reform are "governance" and "transparency".

Redistribution of power

The first pillar is governance. At its core are Sacem's members, united in a General Assembly. The ruling obliges collective management organisations to invest the General Assembly with competencies. The GA is thus truly reinforced and takes general policy decisions pertaining to the distribution of rights, investments, deductions, so-called "un-distributable" sums and how to use said sums.
On 1 January 2018, on-line voting, which is already in operation for elections, will be extended to resolutions. Voting by proxy will also be possible from the same date. Proxies will remain within one and the same member category (creator or publisher). For example, an author cannot accept the proxy of a publisher, and vice versa. There will be a limit of five proxies per representative at each General Assembly.
Dual governance will be introduced from next June, thanks to the creation of a Supervisory Board that will henceforth sit alongside the Board of Directors. The Supervisory Board will comprise two authors, two composers and two publishers elected by the General Assembly for three years; half of each category can be renewed. The conditions of eligibility, dormancy and removal from office are identical to those of the Board of Directors. "The Supervisory Board also monitors the activities of the Board of Directors and the CEO, and ensures they have fulfilled their missions. It assesses their performances in a report that is delivered each year to the General Assembly," explains David El Sayegh, Sacem Secretary General. The Supervisory Board will also be responsible for checking resources and charges, and verifying the society's general accounts.
Currently, these tasks are performed by the Accounts and Supervisory Committee. The Supervisory Board will also take over the tasks that are currently performed by the Article R.321-6-3 Commission, namely assessing refusals to requests from Sacem members wishing to receive company documents. All of the activities of the above two Commissions will thus be transferred to the Supervisory Board.

Some of the General Assembly's prerogatives will also be delegated to the Supervisory Board: decisions pertaining to risk management policy; approving real estate acquisitions, sales and mortgages; approving mergers and alliances; creating subsidiaries and acquiring other entities; approving operations to take out or grant a loan or to provide security on a loan. This adds a further degree of security to decision-making.

Ethics and transparency

The second pillar of the reform is transparency. It will trigger the creation of a new body: the Ethics Committee.
The Ethics Committee will stem from the Board of Directors and the Supervisory Board, both of which will appoint three members (one author, one composer and one publisher) from "their ranks". The committee will be renewed every year. Honorary chairs of Sacem will sit on the Ethics Committee, along with a qualified individual who is external to Sacem and is appointed for three years. The role of the Ethics Committee is to avert, identify, manage and inspect any situation of conflicting interests encountered by the members of Sacem's Board of Directors or Supervisory Board or its CEO. The new ruling also requires each member of these bodies to submit an annual declaration of interests to the General Assembly. The Ethics Committee will collect these declarations of interests. It will also ensure that the rules of eligibility to become a member of Sacem's different Boards and its Statutory Commission are complied with, and it will take over all of the prerogatives of the current Professional Ethics Committee.

"Although transparency was already built into Sacem's DNA, from 2017 it will be anchored into every level," points out David El Sayegh. "From now on, the General Assembly will have to approve a transparency report detailing the year's accounts: How much was spent? On what? How much was collected? How much did that cost? Every new applicant to Sacem will receive this information and will have a breakdown of the society's management costs." The first transparency report will pertain to the 2017 accounting year. It will be sent out to all members to give them a macroeconomic and also a microeconomic overview of the accounts: each distribution sheet in 2018 will give a breakdown of rights, management costs, and sums deducted to social or cultural ends. Furthermore, starting in 2017, each new Sacem applicant will receive detailed information in advance, notably about the rights s/he can bring to Sacem, the conditions for joining and leaving, the society's management costs, etc.

Finally, there will be an in-house procedure for processing complaints relating to joining conditions, contributions, the withdrawal of contributions, resignations and rights management.
There will be a single point of contact within the Membership Department that will address such complaints, and as of 1 January 2018 the process must not take more than two months, unless there is a legitimate reason justifying a longer period (such as, for example, the member not yet having registered the work). Make sure you come to the Extraordinary General Assembly on 1 March!

MAIN CHANGES IN THE REFORM

1. Broader powers for the General Assembly
• The GA takes general policy decisions pertaining to the distribution of rights, investments, deductions, so-called "un-distributable" sums (and decisions on how to use said sums).
• On-line voting extended to resolutions from January 2018.
• Proxy voting introduced in January 2018.

2. Creation of a Supervisory Board
• Monitors the activities of the Board of Directors and the CEO.
• Takes over the tasks of the Accounts and Supervisory Commission and the Article R.321-6-3 Commission.

3. Creation of an Ethics Committee
• Averts, identifies and manages conflicts of interests encountered by the members of Sacem's Board of Directors or Supervisory Board or its CEO.
• Collects annual declarations of interests from members of the Board of Directors and the Supervisory Board and from the CEO.
• Oversees compliance with the rules of eligibility for members of the different Boards and the Statutory Commission.
• Ensures that elections run smoothly.

4. Publication of an annual transparency report
• Available to everyone. Provides Sacem members with detailed information on how their society is performing.

5. Setting up a single point of contact for complaints from Sacem members
• Manages complaints from Sacem members.
• Complaints dealt with within two months, at most, from 1 January 2018.

JEAN-CLAUDE PETIT - "Transparency is already built into our DNA"

How did Sacem's board members broach this obligatory reform?
To prepare the ground for the reform, our working group, composed of several board members, authors, composers and publishers, met on several occasions within the space of almost two years. The other revisions that had been required by law over recent years were not as extensive as the current reform. Our statutes and our policies and procedures are very old. Personally, I believe that regular tweaks are always necessary to take evolutions into account. In the case at hand, it is mainly a question of becoming compliant with European requirements. One of the aims of the reform is to introduce more transparency.

Do you feel that is justified?
Sacem has been striving towards greater transparency for many years now. Few and far between are societies like Sacem, which are inspected both externally and internally. Not to mention the myriad meetings we organise to keep our members informed about the different innovations that are introduced throughout the year. Transparency is already built into Sacem's DNA.

What have you learnt from this mammoth undertaking?
A reform like this gives us an opportunity to reflect on how we operate and on good governance. We are involving our members: they are being asked to give a verdict on the reform on 1 March during an Extraordinary General Assembly.

 

Published February 24 2017