Barclays 2009 Annual Report Download - page 170

168 Barclays PLC Annual Report 2009 www.barclays.com/annualreport09
Corporate governance
Corporate governance report
continued
Board Risk Committee (continued)
The Committee met five times in 2009 and Figure 9 shows how the
Committee allocated its time at those meetings. The items covered under
each heading in Figure 9 are as follows:
Risk Profile/Risk Appetite
– Reviewed the Group Risk Profile Report (including updates on the Group’s
capital position);
–reviewed updates on liquidity risk;
– reviewed in greater detail the process around setting annual Risk Appetite
to establish the effectiveness of the process in responding to significant
changes in economic and market conditions;
– reviewed the Risk Appetite for the Group for 2010 and made
recommendations to the Board; and
– received regular Future Risk Trends reports, which set out the internal and
external indicators that are showing signs of strain and a report on future
risk issues.
Key Risk Issues
– reviewed risk trends in tax risk management;
–received regular reports on ABS and leveraged credit market exposures;
and
– reviewed the Group’s stress testing proposals and outcomes.
Internal Control/Risk Policies
– reviewed the internal control and assurance framework;
–examined the risk control framework, and approved Group policies
including the trading book policy, large exposures policy, liquidity policy,
retail and wholesale credit impairment policies and the Group’s principal
risks policy;
– reviewed risk measurement methodologies; and
– received updates on the programme of actions being taken Group-wide
to mitigate risk in view of deteriorating economic conditions in our major
markets, such as the UK, US, South Africa and Spain.
Regulatory Frameworks
– reviewed the liquidity risk framework and underlying assumptions;
Other
– revised its Terms of Reference, including its role in reviewing risks following
the Group’s entry into new businesses or geographies; its role in reviewing
capital ratios, liquidity risk and its input into remuneration decisions; the
increased frequency of risk, capital and liquidity reporting and the setting
up of an external advisers panel for the Committee; and
– reviewed its Terms of Reference to satisfy itself that they enable the
Committee to fulfil its responsibilities.
More information on risk management and the internal control framework
can be found in the Risk management report on pages 82 to 146.
Relations with Shareholders
Communicating with shareholders is a key priority for the Board and was
particularly important during the continuing financial crisis in 2009. In the
normal course of events, the Board aims to keep shareholders up to date and
informed about how Barclays is performing and its strategy. During 2009,
there was significant additional communication around the sudden fall in
the share price in January 2009, the proposed sale of the iShares business
and the subsequent sale of BGI, for which we held a General Meeting in
August 2009.
Institutional shareholders
Engagement with our institutional shareholders is essential to ensure a
greater understanding of and confidence in the medium and longer-term
strategy of Barclays and in the Board’s ability to oversee its implementation.
The Group Chairman and Senior Independent Director are responsible
for ensuring the Board is accessible to major shareholders and that channels
for communication are open. They are also responsible for ensuring that the
Board is aware of any concerns raised by major shareholders and that their
views are taken on board. The Group Chairman, Senior Independent
Director, Group Chief Executive and Group Finance Director regularly meet
with our investors and the executive Directors and senior executives hold
group and one to one meetings with major investors. The Group Chairman,
Senior Independent Director and Company Secretary also conduct a series
of meetings with the corporate governance representatives of our major
institutional shareholders ahead of each AGM. The Investor Relations team
organise roadshows, seminars, conferences, presentations and other
activities that enable the Directors to engage with investors and some of
these are highlighted below:
– over 100 meetings with US institutions following the acquisition of the
Lehman Brothers North American businesses;
– over 200 one-to-one meetings with investors (the Group Chairman and
Executive Committee members);
– over 40 group meetings with investors; and
– nine presentations at conferences.
In addition, the Investor Relations team also met nearly 150 investors in
one to one and group meetings.
1
2
3
4
2009 2008
% %
1 Risk Profile/Risk Appetite
(including capital
management) 39 55
2 Key Risk Issues (including
ABS and Leveraged
Credit Markets) 28 35
3 Internal Control/Risk Policies 4 4
4 Regulatory Frameworks 9 5
5 Other (including remuneration
and governance issues) 20 1
5
Fig. 9: Board Risk Committee allocation of time