Tesco 2015 Annual Report Download - page 43

Activities during the year
The Committee divides its time broadly between reviewing Executive management
development and succession planning, and reviewing Board development.
Given the substantial changes to the Board it was decided that it would not be appropriate
for a formal review of the effectiveness of the Committee to take place this year. However,
the Committee’s effectiveness was considered as part of the internal Board evaluation.
Appointments
This year the Committee discussed the restructure of the Executive leadership team around
the core capabilities of customers, products and channels, and the need to continue
developing the Board structure and appoint further Non-executive Directors to strengthen
the Board with additional skills and plan for future retirements.
During the year, in addition to the Executive appointments, the Committee identified and
recommended two appointments to the Board. Richard Cousins and Mikael Olsson joined
the Board as Non-executive Directors on 1 November 2014. Richard brings valuable UK
and corporate experience to the Board and Mikael brings valuable retail and international
experience. In addition, the Committee recommended the appointment of Byron Grote as
a Non-executive Director. Byron has extensive executive and non-executive financial and
strategic experience and joined the Board on 1 May 2015. Biographies of these new Directors
are available on pages 28 and 29.
Appointments are subject to annual re-election by shareholders at the AGM.
The Committee prepared role specifications for the Chairman and Non-executive Director
roles and considered a number of factors when making new appointments, including what
the new Director will add to the balance of skills and experience on the Board and whether
the Director will be able to allocate sufficient time to the Company to discharge his or her
responsibilities. Candidates are required to disclose all material commitments to the
Committee as part of the process. We worked with the external search consultancy Lygon
Group and JCA who do not have any connection with the Company, as well as using
our own networks, to identify candidates.
The Committee also considered a number of changes to the composition of the Board’s
Committees to ensure appropriate balance and succession potential.
Diversity
Tesco approaches diversity in its broadest sense, recognising that successful world-class
businesses flourish through embracing intellectual, experiential, geographical and skills
diversity as well as other factors such as gender, marital status, race, age, sexual preference
and orientation, colour, creed, ethnic origin, religion or belief, disability or trade union
affiliation. With regard to gender diversity which is the focus of significant current attention,
we accept the spirit and aspirations of the Davies Report, including the representation of
women at the highest levels in the organisation.
Nominations Committee attendance
Members Number
of possible
meetings
attended
Actual
meetings
attended
John Allan (Chairman)
Appointed 1 March 2015
– –
Sir Richard Broadbent
Chairman to
1 March 2015
5 5
Patrick Cescau
Resigned 7 April 2015
5 5
Stuart Chambers 5 5
Ken Hanna 5 5
Richard Cousins
Appointed 7 April 2015
– –
Nominations Committee report
The primary focus of the Committee during the year was Board succession planning.
The Board appointed a new management team, Dave Lewis as CEO and Alan Stewart
as CFO, following a search led by the former Chairman, Sir Richard Broadbent,
with support from the Non-executive Directors. Both are excellent appointments
for the Company with the right blend of experience, leadership and values to lead
the transformation of the business. The Committee also identified and recommended
the appointment of three new Non-executive Directors, Richard Cousins, Mikael Olsson
and Byron Grote, who bring broad skills and experience to the Board.
In the coming year Board composition and effectiveness will be a key focus for the
Committee along with developing succession plans for the longer term to ensure
appropriate plans are in place to meet the needs of the business.
John Allan
Nominations Committee Chairman
Nominations Committee responsibilities
The Committee’s terms of reference are available
at www.tescoplc.com. Where matters discussed
relate to the Chairman, the Senior Independent
Non-executive Director chairs the meeting.
The key responsibilities of the Committee include:
• Reviewing the Board’s structure, size and composition
• Identifying, nominating and reviewing candidates
for appointment to the Board
• Putting in place plans for succession
• Reviewing the leadership needs of the
organisation, both Executive and Non-executive
• Reviewing the Group’s talent planning programmes
• Reviewing Board succession over the longer term,
in order to maintain an appropriate balance of skills
and experience and to ensure progressive refresh
of the Board
• Monitoring of the Group’s compliance with
corporate governance guidelines
41Tesco PLC Annual Report and Financial Statements 2015
Other informationGovernance Financial statementsStrategic report