HSBC 2009 Annual Report Download - page 308

HSBC HOLDINGS PLC
Report of the Directors: Governance (continued)
Board of Directors > The Board
306
Information, induction and ongoing
development
The Board regularly reviews reports on progress
against financial objectives, on business
developments and on investor and external relations
and receives reports from the chairmen of Board
committees and from the Group Chief Executive.
The Board receives regular reports and presentations
on strategy and developments in the customer groups
and principal geographical areas. Regular reports are
also provided to the Board, the Group Audit
Committee and the Group Management Board on
credit exposures and the loan portfolio, asset,
liability and risk management, liquidity, litigation
and compliance and reputational issues. During
2009, the Board also reviewed the results of the 2009
Global People Survey and approved proposals to
further articulate HSBC’s values. The agenda and
supporting papers are distributed in advance of all
Board and Committee meetings to allow time for
appropriate review and to facilitate full discussion at
the meetings. All Directors have full and timely
access to all relevant information and may take
independent professional advice if necessary.
The Directors have free and open contact with
management at all levels. Group Managing Directors
and Group General Managers meet informally with
Directors after Board meetings. Board offsite visits
are made each year to enable Directors to see at first
hand the operations of subsidiary companies in local
environments and to meet management, employees
and customers. In 2009 the Board visited the US and
Hong Kong.
During 2009, the Board reviewed and approved
changes to the arrangements for Director induction
and development. Full, formal and tailored induction
programmes, with particular emphasis on internal
controls, are arranged for newly appointed Directors
by the Group Company Secretary. The programmes
consist of a series of meetings with other Directors
and senior executives to enable new Directors to
receive information and familiarise themselves with
HSBC’s strategy, operations and internal controls. As
part of the induction process the Group Company
Secretary will coordinate the production of a
development programme based on the individual
Director’s needs. Prior to their appointment, each
Director receives comprehensive guidance on the
duties and liabilities of a Director of HSBC
Holdings. Opportunities to update and develop skills
and knowledge, through externally run seminars and
through briefings by senior executives, are provided
to all Directors.
A personalised approach to training and
development is applied for Directors. Records of
development activities and plans are maintained by
the Group Company Secretary for annual review
with the Director concerned by the Group Chairman.
The Group Company Secretary coordinates the
delivery of any training required. Focused in-house
development programmes to enhance business
awareness, such as on the management of risk, are
arranged in conjunction with scheduled Board
Meetings. Since December 2009, Directors have
online access to HSBC’s internal training and
development resources.
Non-executive Directors have an open invitation
to attend meetings of the Group Management Board
to further enhance understanding and awareness of
HSBC’s businesses and the senior leadership team.
During 2009, W S H Laidlaw, J R Lomax and Sir
Brian Williamson each attended a meeting of the
Group Management Board.
Performance evaluation
In October 2009, Boardroom Review was
commissioned to prepare a report on the
effectiveness of the Board and its Committees. The
objective of the review was to assess the quality of
the Board’s decision making and debate, its overall
contribution to, and impact on, the long-term health
and success of HSBC Holdings, and its preparation
for future challenges. The Boardroom Review
assessment was used to facilitate the Board’s
evaluation of its performance and that of its
Committees and individual Directors’ performance.
There are no conflicts of interest between HSBC and
Boardroom Review, which does not offer other
services such as executive search, corporate finance
or strategic advice.
The Boardroom Review report was prepared
following structured interviews with each of the
Directors and the Group Company Secretary and has
been discussed by the Board. The factors assessed in
the report that are associated with board
effectiveness include Board roles and
responsibilities, individual and collective
contribution, Board processes, Committee processes
and roles, and the effectiveness of the Group
Chairman. The report has been used by the Group
Chairman in his evaluation of the performance of
each Director and by the non-executive Directors,
led by the senior independent non-executive Director
in their evaluation of the performance of the Group
Chairman. The review concluded that the Board and
its Committees were functioning effectively. It is the
intention of the Board of HSBC Holdings to
continue to review its performance and that of its