Tesco 2011 Annual Report Download - page 77

The Bank has established a risk management framework to manage
the risks arising across the business. The framework is driven at a
strategic level by the Bank’s Risk Appetite, which is approved by its
Board. The Internal Capital Adequacy Assessment Process (ICAAP) is
the Bank’s internal assessment of capital adequacy designed to address
the requirements under Pillar 2 of the Basel II framework. The ICAAP
process considers all of the risks faced by the Bank, how these risks
are mitigated and the amount of capital that requires to be held both
currently and in the future. The Bank performs a full ICAAP at least
annually with approval provided by its Board.
The Bank maintains a Key Risk Register, which is subject to regular
review to enable management to determine additional mitigating
actions in cases where the residual risk is outside its Risk Appetite.
The content of the Register is determined through regular discussions
with senior management and reviewed by the Bank’s Board Risk
Committee, its Board and the Tesco PLC Board on a regular basis.
Relations with stakeholders
We are committed to having a constructive dialogue with stakeholders
to ensure we understand what is important to them and allow ourselves
the opportunity to present our position. Every year we carry out a
survey of a cross section of shareholders in order to assess shareholder
perceptions of the Company. The results of this survey are reviewed by
the Board. Engagement helps us identify new risks and opportunities
to ensure that our long-term strategy is sustainable. In some instances
we find that working with stakeholders in partnership can help deliver
shared goals. We might not be able to satisfy all stakeholder concerns
all the time but through engagement we can do our best to balance
competing demands. We know that customers need to be able to trust
our business and they will only trust us if they believe that we are
engaging on an appropriate basis with our stakeholders.
Our programme of engaging with stakeholders including customers,
staff, suppliers, investors, government, regulators, non-governmental
organisations and others, is set out in more detail in our Corporate
Responsibility Report 2011 and on our website.
Shareholder engagement
We maintain a good dialogue with shareholders through proactively
organising meetings and presentations as well as responding to a wide
range of enquiries. We seek shareholder views on a range of issues from
strategy to corporate governance and SEE issues. We recognise the
importance of communicating appropriately any significant Company
developments.
During the year, the Chairman, CEO and Chief Financial Officer met
with a number of our leading shareholders to discuss issues relating
to the performance of the Group and its strategy, as well as new
developments within the business and a range of governance matters.
The Chairman’s meetings with major shareholders took place
independently from the Executive team’s meetings. This year the
Remuneration Committee Chairman also met with a number of major
shareholders to discuss proposed changes to the remuneration
structure for Executive Directors. In addition to this, Investor Relations
engage with shareholders on a regular basis, and on a wide range of
issues. Lucy Neville-Rolfe leads the Company’s contact with socially
responsible investors (SRIs) and has regular meetings, on both a
one-to-one and group basis, to discuss the work the Group is doing on
corporate responsibility and governance-related issues. Following these
meetings the matters raised are discussed with the Board as a whole.
An Investor Relations report is produced for the Board periodically.
This report summarises feedback from shareholders particularly in
terms of our management and strategy, and ensures the Board has
a balanced perspective on the views of our major shareholders.
It is normal that institutional shareholders may be in more regular
contact with the Group than other shareholders, but care is exercised
to ensure that any price-sensitive information is released to all
shareholders, institutions and private, at the same time in accordance
with applicable legal and regulatory requirements. All major
presentations to institutional shareholders are made available to
private shareholders through the Tesco PLC website.
Every shareholder may choose to receive a full Annual Report and
Financial Statements or the Annual Review and Summary Financial
Statement, either in paper or electronic form. These reports, together
with publicly made trading statements, are available on the Group’s
website, www.tescoplc.com
The Tesco PLC AGM
The Annual General Meeting offers the opportunity for the Board to
communicate the Company’s progress directly to shareholders. Our last
Annual General Meeting in July 2010 was held in London. The 2011
AGM will be held in Nottingham at 11am on Friday 1 July. The choice of
location is based on our policy of widening the opportunity for our
shareholders to attend the AGM, by moving to different locations in the
UK each year.
The whole Board attends the AGM and is available to answer questions
from shareholders present. To encourage shareholder participation, we
offer electronic proxy voting and voting through the CREST electronic
proxy appointment service. At our last Annual General Meeting, all
resolutions were voted by way of electronic poll. This follows best
practice guidelines and allows the Company to count all votes, not just
those of shareholders attending the meeting. The Chairman announces
the provisional voting results at the meeting, and the final results are
announced the same day through the Regulatory News Services and
the Tesco PLC website.
By Order of the Board
Jonathan Lloyd
Company Secretary
6 May 2011
Tesco PLC
Registered Number: 445790
Registered in England and Wales
Registered Office: Tesco House, Delamare Road, Cheshunt,
Hertfordshire EN8 9SL
VAT Registration Number: GB 220 4302 3
TESCO PLC Annual Report and Financial Statements 2011
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