The Board hereby resolves to establish a committee of the Board, to be known as the Nominations Committee, to assist the Board in fulfilling its nominations responsibilities.
The Nominations Committee and the Chairman of the Nominations Committee shall be appointed by the Board. All members of the Nominations Committee shall be non-executive directors of the company.
The Chairman of the Board may also serve on the Nominations Committee as an additional member if he or she was considered independent on appointment as Chairman.
The Nominations Committee shall consist of not less than three members and whenever possible will include at least two independent non-executive directors. A quorum shall be two members.
The Chairman of the Nominations Committee shall be appointed by the Board from amongst the independent non-executive directors.
Appointments to the Nominations Committee shall be for a period of up to three years, which may be extended for two further three year periods provided that the Nominations Committee retains two independent directors.
The Secretary of the company shall be the Secretary of the Nominations Committee.
The Secretary shall minute the proceedings and resolutions of all Nominations Committee meetings, including the names of those present and in attendance.
Draft minutes of Nominations Committee meetings shall be circulated promptly to all members of the Nominations Committee. Once approved, minutes should be circulated to all other members of the Board unless in the opinion of the Nominations Committee Chairman it would be inappropriate to do so.
Attendance at meetings
No one other than the Nominations Committee members shall be entitled to attend Nominations Committee meetings.
The Nominations Committee will normally invite the Chief Executive to attend Nominations Committee Meetings.
Meetings of the Nominations Committee may be held by telephone or video conference facility.
Frequency of meetings
The Nominations Committee shall meet at least once a year and at such other times as the Chairman the Nominations Committee shall decide.
Annual General Meeting
The Chairman of the Nominations Committee shall attend the Annual General Meeting and be prepared to respond to any shareholder questions on the Nomination Committee’s activities.
Power to take advice
The Nomination Committee is authorised by the Board to:
- investigate any activity within its terms of reference;
- seek any information that it requires from any employee of the company and all employees are directed to cooperate with any request made by the Nominations Committee;
- obtain outside legal or independent professional advice, at the company’s expense, and secure the attendance of outsiders with relevant experience and expertise if it considers this necessary within reasonable budgetary constraints set by the Board.
The Nominations Committee should carry out the duties detailed below for the parent company, major subsidiary undertakings and the group as a whole, as appropriate.
The Nominations Committee shall:
- regularly review the structure, size and composition (including the skills, knowledge, experience and diversity) of the Board and make recommendations to the Board with regard to any changes;
- give full consideration to succession planning for directors and other senior executives in the course of its work, taking into account the challenges and opportunities facing the company, and the skills and expertise needed on the Board in the future;
- keep under review the leadership needs of the organisation, both executive and non-executive, with a view to ensuring the continued ability of the organisation to compete effectively in the marketplace;
- keep up to date and fully informed about strategic issues and commercial changes affecting the company and the markets in which it operates;
- be responsible for identifying and nominating for the approval of the Board, candidates to fill Board vacancies as and when they arise;
- before any appointment is made by the Board, evaluate the balance of skills, knowledge, experience and diversity on the Board, and, in the light of this evaluation, prepare a description of the role and capabilities required for a particular appointment - in identifying suitable candidates the Nominations Committee shall:
- use open advertising or the services of external advisers to facilitate the search;
- consider candidates from a wide range of backgrounds;
- consider candidates on merit and against objective criteria and with due regard for the benefits of diversity on the Board, including gender, taking care that appointees have enough time available to devote to the position;
For the appointment of a Chairman, the Nominations Committee should prepare a job specification, including the time commitment expected. A proposed Chairman’s other significant commitments should be disclosed to the Board before appointment and any changes to the Chairman’s commitments should be reported to the Board as they arise.
Prior to the appointment of a director, the proposed appointee should be required to disclose any other business interests that may result in a conflict of interest and be required to report any future business interests that could result in a conflict of interest
Additionally, the Nominations Committee shall:
- ensure that, on appointment to the Board, non-executive directors receive a formal letter of appointment setting out clearly what is expected of them in terms of time commitment, committee service and involvement outside Board meetings;
- review the results of the Board performance evaluation process that relate to the composition of the Board;
- review annually the time required from non-executive directors - performance evaluation should be used to assess whether the non-executive directors are spending enough time to fulfil their duties;
- work and liaise as necessary with all other Board Committees.
The Nominations Committee shall also make recommendations to the Board concerning:
- formulating plans for succession for both executive and non-executive directors and in particular for the key roles of Chairman and Chief Executive;
- Suitable candidates for the role of Senior Independent Director;
- membership of the Audit and Remuneration Committees, and any other Board Committees as appropriate, in consultation with the Chairmen of those Committees;
- the re-appointment of any non-executive director at the conclusion of their specified term of office having given due regard to their performance and ability to continue to contribute to the Board in the light of knowledge, skills and experience required;
- the re-election by shareholders of directors under the annual re-election provisions of the Code or the retirement by rotation provisions in the company’s articles of association, having due regard to their performance and ability to continue to contribute to the Board in the light of the knowledge, skills and experience required and the need for progressive refreshing of the Board (particularly in relation to directors being re-elected for a term beyond six years);
- any matters relating to the continuation in office of any director at any time including the suspension or termination of service of an executive director as an employee of the company subject to the provisions of the law and their service contract;
- the appointment of any director to executive or other office.
The Nominations Committee Chairman shall report to the Board on its proceedings after each meeting on all matters within its duties and responsibilities.
The Nominations Committee shall make whatever recommendations to the Board it deems appropriate on any area within its remit where action or improvement is needed.
The Nominations Committee shall produce a report to be included in the company’s annual report about its activities, the process used to make appointments and explain if external advice or open advertising has not been used.
Where an external search agency has been used, it shall be identified in the annual report and a statement made as to whether it has any connection with the company.
The report referred to above should include a statement of the Board’s policy on diversity, including gender, any measurable objectives that it has set for implementing the policy, and progress on achieving the objectives.
The Nominations Committee shall:
- have access to sufficient resources in order to carry out its duties, including access to the company secretariat for assistance as required;
- be provided with appropriate and timely training, both in the form of an induction programme for new members and on an on-going basis for all members;
- give due consideration to laws and regulations, the provisions of the Code and the requirements of the UK Listing Authority’s Listing, Prospectus and Disclosure and Transparency Rules and any other applicable rules, as appropriate;
- arrange for periodic reviews of its own performance and, at least annually, review its constitution and terms of reference to ensure it is operating at maximum effectiveness and recommend any changes it considers necessary to the Board for approval.