The Board’s role is to provide leadership of the Company and is accountable to shareholders for the long-term success of the business. There is a schedule of matters reserved for the Board which includes:
The Chairman is responsible for the leadership of the Board
and ensuring its effectiveness:
The CEO is responsible for the executive management of the Company and ensuring the implementation of Board strategy and policy within the approved budgets and timescales. The CEO is assisted in meeting his responsibilities by the CFO and the Executive Leadership Team (who head up the Company’s principal operations and functions).
The SID is responsible for supporting the Chairman and leading the non-executive directors in the oversight of the Chairman and CEO. The SID is available to shareholders if they have concerns which the normal channels have failed to resolve or where such contact is inappropriate.
The independence, external experience and challenge non-executive directors bring to the Board is essential to its effective operation. The current non-executive directors bring extensive and broad ranging experience as highlighted in their biographies in the Our Leadership section of this website.
The Board has three committees which assist in the discharge of its responsibilities. Their terms of reference are available in the Governance policies section of this website.
Ian Krieger has a wealth of financial, accounting and business experience and was a senior partner and Vice Chairman of Deloitte until his retirement in 2012. He is also Audit Committee Chairman of a number of other listed companies and other organisations.
The Audit Committee is scheduled to meet at least four times a year and meets with the internal and external auditors at least once a year without the executive directors present.
The Committee has been delegated authority by the Board to monitor financial reporting including the annual and interim reports, preliminary results announcements and formal announcements relating to financial performance and reporting. The Committee ensures the effectiveness of the Company’s internal controls and risk management systems and review and update the whistle-blowing arrangements.
The Committee monitors and reviews the effectiveness of the Company’s internal audit function, including the approval of any appointment or removal of the head of the internal audit function. The Committee is also responsible for considering and making recommendations to the Board on the appointment, reappointment and removal of external auditors including the setting of their remuneration. The Committee keeps under review the external auditor's’ independence which includes reviewing the impact of any non-audit services provided by the Group’s external auditors to the Board.
Annually the Committee reviews the relationship the Company has with its auditors to consider whether the relationship is working well and the auditors are continuing to be effective. The external auditors are required to rotate the audit partners responsible for the Group and subsidiary audits every five years. There are no contractual obligations restricting the Company’s choice of external auditors.
There is an established policy governing auditor independence and the engagement of the external auditor for non-audit services designed to maintain the independence and objectivity of the external auditors. The policy was reviewed and updated in 2013 and key terms of the updated policy are as follows:
The Code recommends that companies put their external audit contract out to tender at least every 10 years. As explained in more detail in annual report 2014/15, PricewaterhouseCoopers LLP (PwC) were retained to audit their 11th set of financial statements for the 2014/15 financial period due to significant business change in the period.
There are no contractual obligations restricting the Committee’s choice of auditor and shortly after the conclusion of annual report 2014/15 a tender exercise was undertaken. A number of audit firms were requested to tender for the contract, including PwC, and a shortlist of three firms advanced to the final stage of the tender process. The Committee recommended the appointment of KPMG LLP (‘KPMG’) based on an impressive proposal, the experience of their lead partner and a competitive fee structure. The Board’s appointment of KPMG was announced in September 2015.
The Committee has responsibility for determining and agreeing the overall remuneration strategy for executive directors and senior managers, determining the individual remuneration packages for the Chairman, executive directors and senior management and approving the design of all share incentive plans.
Ms Laing was appointed Chairman of the Remuneration Committee in May 2014. Following his appointment as Chairman in June 2012, it was agreed that David Beever would remain as a member of the Remuneration Committee but would no longer considered independent under the terms of the Code.
The Remuneration Committee is scheduled to meet at least twice a year.
The Committee is committed to principles of accountability and transparency to ensure that remuneration arrangements demonstrate a clear link between reward and performance. In its work, the Committee considers fully the relevant legal and regulatory requirements, provisions and recommendations of the Code and associated guidance.
The Committee has been delegated authority by the Board to determine and agree the remuneration strategy for executive directors and senior managers — it is vital to our business that we retain individuals and reward performance and contributions towards the success of the Company. In addition the Committee reviews and approves the remuneration packages for the Chairman, executive directors and senior managers.
The Committee, on behalf of the Board, determines the terms of employment including recruitment and termination terms of executive directors, ensuring any payments on departure are fair to the individual and the Company, whilst avoiding payment for failure and recognising the departing individual’s duty to mitigate loss.
The Committee is responsible for considering the size, structure and composition of the Board, retirement and appointment of additional and replacement directors and making appropriate recommendations so as to maintain an appropriate balance of skills and experience on the Board.
The Nomination Committee is scheduled to meet at least twice a year.
The Committee has been delegated authority by the Board to lead the formal, rigorous and transparent process for Board appointments including a review of the skills, experience and knowledge of the existing directors to ensure any potential shortlisted candidates will benefit the balance of the Board. The Committee also gives full consideration to succession planning taking into account the challenges and opportunities facing the Company and what skills and expertise would benefit the Board in the future.
The Committee regularly reviews the structure, size and composition of the Board and make recommendations to the Board regarding changes.
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