BT 2009 Annual Report Download - page 58

ADDITIONAL INFORMATION FINANCIAL STATEMENTS REPORT OF THE DIRECTORS BUSINESS AND FINANCIAL REVIEWS OVERVIEW
56 BT GROUP PLC ANNUAL REPORT & FORM 20-F
REPORT OF THE DIRECTORS
REPORT OF THE NOMINATING COMMITTEE
Introduction
The Nominating Committee is chaired by the Chairman. The other
members are the Deputy Chairman, Clay Brendish, Eric Daniels and
Phil Hodkinson. Clay Brendish and Eric Daniels joined the
Committee on 8 May 2008. Four of its five members are
independent non-executive directors. Although he is not
independent, the Board believes that Sir Michael Rake, as Chairman
of the Board, is the most appropriate person to chair the
Committee. He would not participate in the selection and
appointment of his successor. The Company Secretary and, where
appropriate, at the invitation of the Chairman, the Chief Executive
attend the Committee’s meetings.
Committee role and activities
The Committee’s terms of reference are available from the Company
Secretary and are posted on our website at
www.bt.com/committees The
Nominating Committee ensures an
appropriate balance of experience and abilities on the Board, using
this evaluation to review the size and composition of the Board and
recommending any proposed changes to the Board.
It keeps under review the need to refresh the Board, prepares a
description of the specific experience and skills needed for an
appointment, considers candidates who are put forward by the
directors and external consultants, and recommends to the Board
the appointments of all directors after having met short-listed
candidates. It makes recommendations to the Board on whether to
reappoint non-executive directors at the end of terms of office. It
also reviews the time required from the Deputy Chairman and other
non-executive directors to carry out their duties and advises the
Board on succession planning for the positions of the Chairman,
Deputy Chairman, Chief Executive and all other Board
appointments.
The Committee met twice during the 2009 financial year. It
reviewed Board succession, the size, profile and composition of the
Board, and the Board and Committee evaluation questionnaire and
process. Under the leadership of the Chairman, the Committee,
supported by the Committee’s appointed search consultants,
MWM, conducted a thorough search process to identify candidates
for the positions of Chief Executive, and consequently of Chief
Executive BT Retail, Chief Executive BT Global Services and
consequently Group Finance Director. The Committee
recommended to the Board the internal appointments of Ian
Livingston (formerly Chief Executive BT Retail), Gavin Patterson,
Hanif Lalani (formerly Group Finance Director) and
Tony Chanmugam respectively.
The Committee also reviewed and recommended to the Board,
following rigorous review, the continued appointment of Clay
Brendish and Phil Hodkinson for a further three years. Clay
Brendish and Phil Hodkinson retire by rotation at the 2009 AGM.
The minutes of
Nominating Committee meetings are sent, at
their request, to directors who are not members of the Committee,
where appropriate to do so.
Board evaluation
The Nominating Committee considered options for an independent
third party conducting the sixth formal evaluation in 2008, and,
following Board discussion, this was subsequently carried out by
Egon Zehnder during February-April 2008 by way both of
questionnaire and interview. The review focused on unlocking
greater effectiveness rather than grading the past. Private sessions
were held with each director and feedback was given to them
individually.
The Board considered the results of the review and agreed a
number of recommendations. Progress has been made in
implementing them; in particular, the membership of the
Nominating Committee has been increased, the Remuneration
Committee
has simplified the structure of executive remuneration,
customer segment strategies have continued to be discussed and
more time has been set aside in Board meetings for the discussion
of customer service and the ‘right first time’ initiative. A further
review was carried out by the Chairman and Secretary through a
questionnaire and discussion with directors in April 2009. The
results of the work are currently being considered and reviewed by
the Board and an action plan will be produced. The Deputy
Chairman reviewed the performance of the Chairman taking into
account the views of the non-executive directors.
Separate questionnaires about
Audit Committee effectiveness
were also completed and the outcome of the review are in the
Report of the Audit Committee.
Report of the Committee for
Responsible and Sustainable
Business
Introduction
The Committee for Responsible and Sustainable Business is chaired
by the Chairman and comprises: Gavin Patterson, Chief Executive
BT Retail; Larry Stone, President Group Public and Government
Affairs; and Alex Wilson, Group Human Resources Director; three
non-executive directors: Clay Brendish, Phil Hodkinson and
Deborah Lathen and three independent members: Lord Hastings,
Baroness Jay and Dame Ellen MacArthur.
Committee role
With input and recommendations from executive management and
advice from an independent experts panel, the Committee sets the
‘responsible and sustainable business’ strategy for the BT group
globally (including wholly owned subsidiaries) for approval by the
Board, and reviews and agrees implementation plans and targets,
evaluates performance, embeds responsible activity into standard
business practice, oversees a culture of transparency and
stakeholder accountability and distributes, within the approved
budget, funding to support the strategy.
Committee activities
The Committee aims to optimise the positive impact of BT as an
organisation through exemplary application of communication
services; and through responsible policies, behaviour and practices.
It promotes world class corporate responsibility (CR) performance
to minimise any CR risks to BT’s operations and reputation, and
helps to maximise business opportunities from CR. It encourages
the innovation of new communication services that help create a
more sustainable society and ensures that BT both adopts best
practice and policy in the workplace, including the development of
skills and talent, and makes a fitting contribution to the
communities within which BT operates. It met three times in the
2009 financial year.
REPORT OF THE DIRECTORS