The Board is responsible to shareholders for the management and control of the Company’s activities and is committed to the highest standards of Corporate Governance. The principal governance rules applying to UK companies listed on the London Stock Exchange are contained in the Combined Code on Corporate Governance adopted by the Financial Reporting Council in June 2006 (The Code).
More information on Corporate Governance can be found in the Annual Report an Account 2009
Board composition and balance
The Board comprises a Non-Executive Chairman, four Independent Non-Executive Directors and two Executive Directors.
The posts of Chairman and Group Chief Executive are separated. The Chairman is responsible for the workings and leadership of the Board and for the balance of its membership. The Chief Executive is responsible for leading and managing the business within the authorities delegated by the Board.
The Executive Director Board members are Jeremy Helsby, CEO and Simon Shaw, CFO. Martin Angle, Timothy Ingram, Charles McVeigh and Fields Wicker-Miurin are Independent Non-Executive Directors. The Board considers that the Non-Executive Directors are independent of management and have no business or other relationship which could interfere materially with the exercise of their judgement.
Since 1 November 2004, Timothy Ingram has been the Senior Independent Director.
Functioning of the Board
The Directors receive management information, including financial, operating and strategic reports, in advance of Board meetings. The Board has adopted a formal schedule of matters specifically referred to it for decision which is under continuous review. Matters reserved for the Board include:
- approval and management of Group strategy;
- approval of the annual operating and capital expenditure budgets and any material changes;
- review of performance, assessed against the Group’s strategy, objectives, business plans and budgets;
- approval of interim and preliminary announcements and the Annual Report and Accounts;
- approval of the dividend policy;
- approval of any significant changes in accounting policies or practices;
- extension of the Group's activities and into new geographic areas;
- approval of any significant acquisitions or investments;
- any decision to divest or close any Group business;
- delegation of the appropriate authorities and agreeing terms of reference for its various committees;
- delegation of the appropriate authorities to the Group Executive Board; and
- the appointment of new Directors.
The Non-Executive Directors meet separately at least twice each year without the presence of the Executive Directors and also meet without the Chairman, at which time the Chairman's performance is appraised.
The Group Company Secretary is responsible for ensuring that Board procedures are followed and for advising the Board on governance matters.
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Board committees
The Board has delegated certain authorities to committees. The principal committees of the Board are as follows:
Nomination Committee
The Committee consists of the four independent Non-Executive Directors, the Chairman and Group Chief Executive. The Committee is chaired by the Group Chairman, Peter Smith. The Committee meets at least once a year. The Committee provides a forum to consider Board vacancies or new positions on the Board of Directors, whether to recommend the re-election of a Director and to make recommendations to the Board on certain matters including its composition and balance.
The Company's Articles of Association provide that Directors must submit themselves for re-election every three years and that newly appointed Directors must submit themselves for re-election at the first Annual General Meeting after their appointment. In making recommendations to shareholders for the re-appointment of any Director, the Nomination Committee considers that Director's performance and ongoing contribution to the success of the Company and makes its relevant recommendation to the Board.
Nomination Committee Terms of Reference - PDF(PDF - 13 KB)
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Audit Committee
The Committee consists of the four independent Non-Executive Directors. The Committee is chaired by Fields Wicker-Miurin. The meetings are also attended by the Non-Executive Chairman, Group Chief Executive, Group Chief Financial Officer, Group Financial Controller, the internal auditors, the external auditors, Group Risk Director, Group Company Secretary and other senior executives of the Group by invitation. The Board considers that the members of the Audit Committee collectively have sufficient recent and relevant financial experience to carry out the functions of the Committee.
The Committee is authorised to investigate any matter within its terms of reference and, where necessary, to obtain external legal or other independent professional advice.
The Committee also considers on an ongoing basis the independence of the external auditors and has established policies to consider the appropriateness or otherwise of appointing the external auditors to perform non-audit services.
The internal auditors are KPMG who serve the Group on a global basis. The UK and the majority of the non-UK businesses have established whistle blowing procedures to enable employees to raise concerns about possible improprieties in financial reporting and other matters on a confidential basis.
Audit Committee Terms of Reference - PDF(PDF - 69 KB)
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Remuneration Committee
The Committee consists of the four independent Non-Executive Directors and the Chairman. It is chaired by Charles McVeigh and meets at least three times a year to determine Company policy on senior executive remuneration and to agree the remuneration packages of the Executive Directors. The Committee takes the advice of external consultants from time to time. The Group Chief Executive is consulted on the remuneration packages of the other Executive Directors and attends Committee meetings by invitation, except when his own remuneration arrangements are being discussed. The committee is also advised by external advisers on remuneration matters.
The Committee does not deal with the fees paid to the Non-Executive Directors or the Chairman which are decided by the Executive Directors.
Remuneration Committee Terms of Reference - PDF(PDF - 10 KB)
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Group Executive Board
The GEB comprises the Group Chief Executive, the Group Chief Financial Officer, the managing directors of the main operating subsidiaries and the Group Company Secretary. Under the leadership of the Group Chief Executive, the GEB is responsible for managing the operations of the Group including risk management, reviews Group policy and codes of conduct, the development and implementation of strategy and authorises certain investments, monitors Group performance and deals with other specific matters delegated to it by the Board. The GEB meets monthly.
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Board performance and evaluation
In accordance with established practice, a formal evaluation of Board performance, led by Tim Ingram, the Senior Independent Director, is conducted annually.
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Relations with shareholders
The Group recognises the importance of maintaining regular dialogue with its shareholders. The Group Chief Executive and Group Chief Financial Officer have a regular programme of meetings and presentations with analysts and investors which ensures that the Board is aware of shareholders' views, including presentations at the time of the Company's preliminary announcement of annual and interim results. The Board also reviews a report at least twice each year from its corporate broker on feedback from investors and the market's view of the Company.
The Annual General Meeting provides the Board with a valuable opportunity to communicate with private shareholders and is generally attended by the all the Directors.
The Company has taken advantage of the provisions within the Companies Act 2006 which allows communications with shareholders to be made electronically where shareholders have not requested hard copy documentation.
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