BT 2006 Annual Report Download - page 45

BT’s non-executive directors
The Nominating Committee has agreed and periodically reviews
the combination of experience, skills and other attributes which
the non-executive directors as a whole are to bring to the
Board. This profile is used by the Committee when the
appointment of a non-executive director is being considered to
assess the suitability of candidates, who are put forward by the
directors and outside consultants. Short-listed candidates meet
the Committee, which then recommends to the Board a
candidate(s) for appointment.
The non-executive directors provide a strong, independent
element on the Board. Between them, they bring experience
and independent judgement, gained at the most senior levels,
of international business operations and strategy, finance,
marketing, technology, communications and political and
international affairs.
Sir Anthony Greener, the Deputy Chairman, is the senior
independent director. He chairs the Audit and Remuneration
Committees. In his capacity as the chairman of the Remuneration
Committee, he meets with BT’s major institutional shareholders.
The Deputy Chairman also continues to be available to discuss
matters with institutional shareholders where it would be
inappropriate for those discussions to take place with either the
Chairman or the Chief Executive.
Non-executive directors are appointed initially for three
years, subject to three months’ termination notice from either
BT or the director. At the end of the first three years the
appointment may be continued by mutual agreement. Each
non-executive director is provided, upon appointment, with a
letter setting out the terms of his or her appointment, including
membership of Board committees, the fees to be paid and the
time commitment expected from the director. The letter also
covers such matters as the confidentiality of information and
the company’s share dealing code.
Principal Board committees
The Operating Committee, the company’s key management
committee, meets weekly and is chaired by the Chief Executive,
Ben Verwaayen. The other members are the Group Finance
Director and the Chief Executives of BT Retail, BT Wholesale
and BT Global Services. The Secretary attends all meetings. The
Group Strategy and the Group HR Directors normally attend
each meeting. The Committee has collective responsibility for
running the group’s business end-to-end. To do that, it
develops the group’s strategy and budget for Board approval,
recommends to the Board the group’s capital expenditure and
investments budgets, monitors the financial, operational and
customer quality of service performance of the whole group,
reviews the group’s risks register, allocates resources across the
group within plans agreed by the Board, plans and delivers
major cross-business programmes and reviews the senior talent
base and succession plans of the group. Within the group’s
corporate governance framework, approved by the Board, the
Operating Committee is empowered to approve, up to limits
after which Board approval is required, capital expenditure,
disposals of fixed assets, the making of investments by the
group and divestments. It is authorised to delegate these
approvals, up to its own limits, to senior executives.
To meet best corporate governance practice, the Audit
Committee, the Remuneration Committee and the Nominating
Committee have long been an established part of BT’s system of
governance. Each committee has written terms of reference,
which are available on the company’s website. The Report of
the Audit Committee, the Report of the Nominating
Committee and the Report on directors’ remuneration are on
pages 48 to 61.
The Equality of Access Board (EAB) was established on
1 November 2005, as part of the Undertakings given by BT to
Ofcom following Ofcom’s Strategic Review of
Telecommunications, to monitor, report and advise BT on BT’s
compliance with these Undertakings. The EAB is a committee of
the BT Group plc Board, which formally approved its formation
and its terms of reference. As required by the Undertakings, the
EAB comprises five members: Carl Symon, a BT Group plc non-
executive director and chairman of the EAB; a BT senior
executive, Sally Davis, Chief Portfolio Officer; and three
independent members: Sir Bryan Carsberg, Stephen Pettit and
Dr Peter Radley. The EAB reports regularly to the Board.
Meetings attendance
The following table shows the attendance of directors at
meetings of the Board and Audit, Remuneration and Nominating
Committees during the 2006 financial year.
Board
c
Audit
Committee
Remuneration
Committee
Nominating
Committee
(Attendance shown for committee member)
Number of meetings 11 4 4 4
Sir Christopher Bland 11 4
Matti Alahuhta
a
2
Maarten van den Bergh 9443
Clay Brendish 9 4
Andy Green 11
Sir Anthony Greener 8243
Phil Hodkinson
a
1
Lou Hughes
b
633
Margaret Jay 10 4
Hanif Lalani 11
Ian Livingston 11
John Nelson 9 4 4
Paul Reynolds 10
Carl Symon 9 4 4
Ben Verwaayen 11
aAppointed a director on 1 February 2006
bGranted unpaid leave of absence by the Board from 1 September 2004 to 30 June 2005 to lead
the civil reconstruction effort for the US Government in Afghanistan. Resigned as a director on
31 March 2006
cIncludes two ad hoc meetings
Service agreements
The Chairman and executive directors have service agreements,
which are approved by the Remuneration Committee. Information
about the periods of these contracts is in the Report on
directors’ remuneration.
Independent advice
The Board has a procedure for directors, in furtherance of their
duties, to take independent professional advice if necessary, at
the company’s expense. In addition, all directors have access to
the advice and services of the Secretary.
Training and information
On appointment, the directors take part in an induction
programme when they receive information about BT, the role of
the Board and the matters reserved for its decision, the terms
of reference and membership of the principal Board
committees, and the powers delegated to those committees,
the company’s corporate governance policies and procedures,
including the powers reserved to the group’s most senior
executives, and the latest financial information about the
group. This is supplemented by visits to key BT locations and
meetings with members of the Operating Committee and other
Report of the directors BT Group plc Annual Report and Form 20-F 2006 43