|
In fulfilling their responsibilities, apart from complying with the general law, Directors of GKN plc are required to comply with the duties set out in the Companies Act 2006. These apply both to decisions made by Directors themselves and to decisions made through the delegation of their authority to Board Committees and individuals.
The Board is collectively responsible for the success of the Company. Its role is to provide entrepreneurial leadership of the Company within a framework of prudent and effective controls which enables risk to be assessed and managed. The Board sets the Company’s strategic aims, ensures that the necessary financial and human resources are in place for the Company to meet its objectives, and reviews management performance. It also sets the Company’s values and standards and ensures that its obligations to its shareholders (including reporting to shareholders on the Board’s stewardship) and others are understood and met. Specific responsibilities reserved to the Board include:
- setting Group strategy and approving an annual budget and medium term projections;
- reviewing operational and financial performance;
- approving major acquisitions, divestments and capital expenditure;
- reviewing the Group’s systems of financial control and risk management;
- ensuring that appropriate management development and succession plans are in place;
- reviewing the activities of the three sub-committees of the Executive Committee;
- reviewing matters relating to corporate social responsibility, including the environmental, health and safety performance of the Group;
- approving appointments to the Board, to the Executive Committee and to the position of Company Secretary, and approving policies relating to Directors’ remuneration and the severance of Directors’ contracts; and
- ensuring that a satisfactory dialogue takes place with shareholders.
A description of the role of the Board, together with that of the Chairman, Chief Executive, Senior Independent Director and Company Secretary, is available via the related information links above and further details of the Board’s role in relation to the Group’s systems of internal control and risk management can be found here.
The Board currently comprises five executive and six non-executive Directors including the Chairman. Biographical details of the Directors are available via the related information link of GKN Directors above. With the exception of the Chairman, who is presumed under the Code not to be independent, all the non-executive Directors are regarded by the Board as independent and the Board does not consider that there exist any relationships or circumstances likely to affect the judgement of any Director.
The Board meets formally at least eight times a year, usually with at least one meeting at a Group operating company. A 12 month rolling programme of items for discussion by the Board is prepared to ensure that all matters reserved to the Board and other key issues are considered at appropriate times. During the year there are sufficient opportunities for the Chairman to meet with the non-executive Directors without the executive Directors being present should this be deemed appropriate.
The Committee consists of the executive Directors, the Group Human Resources Director, the Chief Executive OffHighway and the Company Secretary under the chairmanship of the Chief Executive, Sir Kevin Smith CBE.
The members of the Committee are:
The Executive Committee is tasked with leading, overseeing and directing the activities of the Group. It is responsible for reviewing divisional and Group strategy plans, approving and leading the consistent implementation of business and operational processes, and identifying, evaluating and monitoring the risks facing the Group and deciding how they are to be managed. The Committee meets formally at least eight times a year.
The Executive Committee has three sub-committees consisting of members of senior management:
- the Lean Enterprise Sub-Committee is responsible for driving operational best practice globally through the application of Lean business processes;
- the Group Technology Strategy Board is responsible for development of the Group’s technology plan, driving the development of appropriate technologies across the Group and the strengthening of external relationships including access to sources of funding; and
- the Governance and Risk Sub-Committee has responsibility for developing strategy for and providing oversight and direction on all matters relating to governance and compliance, risk management and corporate social responsibility.
The Committee meets at least four times a year and consists of the independent non-executive Directors under the Chairmanship of
John Sheldrick.
The members of the Committee are:
The Audit Committee ensures the integrity of financial reporting and audit processes and the maintenance of a sound internal control and risk management system. A report by the Committee on its activities is available here.
The Remuneration committee meets periodically when required and comprises the independent non-executive Directors under the chairmanship of Richard Parry-Jones. The members of the Committee are:
The Remuneration Committee is responsible for approving the terms of service and setting the remuneration of the executive Directors and the Company Secretary in accordance with a remuneration policy which is approved annually by the Board. It is also responsible for determining the fees of the Chairman and the terms upon which the service of executive Directors is terminated having regard to a severance policy adopted by the Board, and for monitoring the remuneration of senior managers just below Board level. It also prepares for approval by the Board the annual report on Directors’ remuneration (Click here to view the 2009 Remuneration Report).
The Committee has access to such information and advice both from within the Group and externally, at the cost of the Company, as it deems necessary. It is responsible for appointing any consultants in respect of executive Directors’ remuneration.
The Committee meets periodically when required and consists of the non-executive Directors and the Chief Executive under the chairmanship of the Chairman, Roy Brown (except when the Committee is dealing with the appointment of a successor as Chairman when the Senior Independent Director chairs the Committee).
The members of the Committee are:
The Nominations Committee leads the process for identifying, and makes recommendations to the Board on, candidates for appointment as Directors of the Company and as Company Secretary, giving full consideration to succession planning and the leadership needs of the Group. It also makes recommendations to the Board on the composition of the Nominations Committee and the composition and chairmanship of the Audit and Remuneration Committees. It keeps under review the structure, size and composition of the Board, including the balance of skills, knowledge and experience and the independence of the non-executive Directors, and makes recommendations to the Board with regard to any changes.
The Nominations Committee follows Board-approved procedures (available via the link above) in making its recommendations. It has access to such information and advice both from within the Group and externally, at the cost of the Company, as it deems necessary. This may include the appointment of external executive search consultants where appropriate.
|
