BT 2014 Annual Report Download - page 90

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Governance
Governance
Governance structure and eectiveness
We continue to keep the membership of BT’s Board committees under
review. The Board approved in April 2014 a number of changes to
committee membership following Patricia Hewitt’s retirement and our
new non-executive director appointments. You can read about this on
page 81. Earlier in the year, we recommended to the Board that Tony
Chanmugam become a member of the
BT Pensions Committee, which he
did from 1 October 2013.
We reviewed our terms of reference and recommended some changes
to the Board, which they approved in April 2014. The changes reect a
further renement of some of our governance and compliance activities
and have made explicit our relationship with BT’s Director of Compliance,
whom we hold to account for the eective application and continued
performance of many of BT’s signicant compliance programmes.
We evaluated our eectiveness through a questionnaire sent to
committee members, the Chief Executive and Company Secretary in
March 2013. Over 70% of responses rated the committee’s overall
eectiveness as good or above. We discussed the results and proposed
actions in July. In December, we reviewed the action plan and highlight
our progress in key areas in the table below
We recommended to the Board that, in line with the Code, the Board’s
evaluation for 2014/15 be undertaken externally by Lintstock.
Thisfollowed a tender exercise conducted by the Company Secretary.
Board members and the Company Secretary have completed separate
electronic questionnaires on the Board, the Committees, the role of the
Chairman and on their own individual contribution. The Board
questionnaire includes a focus on Board composition and expertise,
howthe Board works, its role in setting strategy, its understanding
ofthekey risks facing the group, succession planning and a case study
onthe Board’s role in the purchase of football broadcasting rights.
Thiswas followed by individual interviews with Lintstock during March
and a report to the Board in May 2014.
The Board will discuss the results of the evaluation at a future Board
meeting. The Chairman will also conduct one-to-one interviews with
directors on their performance and the Senior Independent Director,
Nick Rose, will conduct the annual evaluation of the Chairman.
We noted the list of external directorships and other interests held by
themembers of the
Operating Committee as at March 2014.
Governance and compliance
Governance and compliance programmes
As part of our governance oversight role, we have reviewed a number
of BT’s core compliance programmes. We received a presentation on the
increasingly important data governance programme and endorsed the
current areas of focus. We also reviewed BT’s proposed conict minerals
compliance programme and received an update on BT’s programme to
monitor international trade and sanctions. At each meeting, we received
an update on the implementation of our anti-corruption and bribery
compliance programme for agents (agents programme) and highlighted
the important oversight role that the Regional Governance Committees
(RGCs) have to play.
We endorsed a move to a new approach for mandatory compliance
training. This includes annual assessment to allow people to demonstrate
their competence, followed by focused learning in areas which the
assessment highlights is required as well as re-assessment to provide
assurance that learning has been eective. We received an update on
the programme of externally conducted in-country risk reviews and the
proposed next steps.
Key areas Actions
Continued focus on
succession planning
We have further strengthened the Board
with the appointments of Warren East
and Iain Conn. Patricia Hewitt as the then
Senior Independent Director met with
the non-executive directors to discuss
the succession planning for BT Group’s
chairmanship.
Keep under review
the potential areas of
similar duties of some
Board committees
We held a joint meeting of the
Audit &
Risk
and the Nominating & Governance
Committees
in March 2014 and plan to
hold this annually.
Regional Governance
Committees to include
a broader range of
matters and metrics
We have noted a number of
enhancements to the reporting
information reviewed by the Regional
Governance Committees, which now
includes tracking the resolution of data
governance, security, environment,
anti-corruption and bribery issues.
Wereceived a report measuring the
progress and maturity of BT’s core
compliance programmes.
Carry out deeper
reviews of core
compliance
programmes
We have reviewed BT’s programmes
on conict minerals compliance
data governance international trade
and sanctions human rights and
UK telecommunications regulatory
compliance.
Publication of more
case studies of good
and bad behaviour in
relation to compliance
programmes
The company has published in the
annual Better Future report the number
of people who leave BT in the UK as
a result of ethical misconduct. The
company will use this information and
regular reporting on the numbers of
compliance/ethics-related misconduct
cases to help understand root causes and
potential trends in non-compliance and
drive compliant behaviour. BT promotes
examples of good behaviour on its
compliance champions webpage.
Key areas Actions
Continued training on
good governance and
compliance practices
The Board had a governance seminar
in June 2013. This covered regulatory
challenges and opportunities data
privacy the new regime for voting and
reporting on directors’ pay changes in
narrative reporting and an update on
recent enforcement actions regarding
disclosures and inside information.
The Company Secretary provides a report
to each Board meeting and this includes
updates on governance and compliance
developments.