On 21 October 2010, the Board comprised the Chairman, three executive directors and three independent non-executive directors. Short biographies of each of the directors, which illustrate their range of experience and qualifications can be found in the Board of Directors section. Jonathan Bunting and Nick Gresham were appointed to the Board as executive directors on 1 April 2010 and 1 August 2010 respectively.
There is a clear division of responsibility at the head of the Company
No individual or group dominates the decision-making process
There is a clear division of responsibility at the head of the Company; Dennis Millard (Chairman) being responsible for running the Board and Mark Cashmore (Group Chief Executive) being responsible for implementing Group strategy. John Worby has been nominated by the Board as the Senior Independent Director. The Board structure ensures that no individual or group dominates the decision-making process.
Dennis Millard, who was non-executive Deputy Chairman until his appointment as Chairman on 6 February 2008, met the independence criteria set out in the combined Code ('the Code') on appointment as a director. Andrew Brent, Anthony Cann and John Worby, who served as non-executive directors throughout the year and up to the date of this report meet the independence criteria set out in the Code. The Board is satisfied that the directors who have external directorships have sufficient time available to be effective members of the Board.
The Board, which had eight scheduled meetings and two additional meetings during the year, manages the Company through a formal schedule of matters reserved for its decision. These include:
- overall strategic management of the Company, including acquisitions and disposals;
- approval of long-term objectives and commercial strategy;
- approval of the annual operating and capital expenditure budgets;
- major capital expenditure;
- changes relating to the Company's capital structure;
- approval of the accounts, material agreements and non-recurring projects;
- treasury policy;
- control, audit and risk management;
- remuneration of directors and senior managers; and
- corporate responsibility.
The Board also delegates specific responsibilities to the Board Committees (details under Board Committees). The role and responsibilities of each Committee are set out in formal terms of reference which are reviewed annually.
All directors have access to the advice and services of the Company Secretary and may take independent professional advice at the Company’s expense where necessary. In preparation for Board meetings, information is received by the Board in a timely manner, of a quality sufficient for the Board to take decisions. All new directors receive induction training on joining the Board, which is tailored to meet the needs of the individual. The induction programme is supplemented by ongoing training and development, the need for which is regularly assessed by the Board.
The Company’s Articles of Association (the 'Articles') require that directors offer themselves for re-election every three years and that new directors appointed by the Board offer themselves for election at the next Annual General Meeting following their appointment. However, in accordance with the new UK Corporate Governance Code (the “New Code”), which replaces the existing Combined Code on Corporate Governance for accounting periods beginning on or after 29 June 2010, the Board has agreed that all directors will stand for re-election at the Annual General Meeting (“AGM”) on 14 January 2011. This is notwithstanding that the Company, which is a ‘smaller company’ for the purposes of the New Code, is not formally required to re-elect all directors on an annual basis.
The Board has a formal process for evaluating its performance, the performance of its committees and of individual directors. This process takes place in August and September each year and consists of: each director completing an extensive questionnaire covering Board and Committee procedures and effectiveness and individual contributions to Board and Committee meetings; a one-to-one discussion between the Chairman and each director to discuss their contribution and performance during the year and training needs, if any; and a meeting of the non-executive directors led by the senior independent director to discuss the Chairman’s performance and provide feedback.
The findings of this year’s evaluation were considered by the Board at its September meeting. The Chairman led this discussion, based on the responses to the questionnaires and his one-to-one discussions. The Board also reviewed the two main actions arising from the 2009 evaluation process (the scheduling of additional depot visits following the increase in size of the network and the continuation of the programme of pre-Board breakfast meetings with functional teams) and noted that these had been implemented during the year.
The outcome of the evaluation was that the Board is working effectively with an appropriate balance of skills and adequate time and resources. With the Company’s increasing focus on corporate development, it was felt that the Board had been strengthened by the appointment of Jonathan Bunting during the year and that this had further increased its effectiveness. In addition, in accordance with the New Code, it was agreed that the Board would review its collective risk appetite with a view to outlining its approach to risk in next year’s Annual Report.
Click here for Matters Reserved for the Board (pdf download)