Unilever 2005 Annual Report Download - page 55

52 Unilever Annual Report and Accounts 2005
Report of the Nomination Committee
Composition
In 2005 the Nomination Committee comprised three Independent
Non-Executive Directors and the Chairman of the Boards.
Bertrand Collomb chaired it throughout 2005. Other members
throughout 2005 were David Simon, Jeroen van der Veer and
Antony Burgmans. The Joint Secretaries act as secretaries to the
Committee.
The composition of the Committee, having a majority of
Independent Non-Executive Directors, ensures that these Directors
control the procedure for nominating the candidates for election
as Directors of NV and PLC. To ensure that the candidates
presented for election as Directors of NV and PLC are the same,
the members of the Nomination Committee are also the Directors
of N.V. Elma and United Holdings Limited. These two companies
jointly own the Special Shares of NV and the Deferred Shares of
PLC which carry the right to nominate persons for election as
Directors of NV and PLC at general meetings. In December 2005
it was announced that we will propose to change this process to
allow shareholders the right to nominate candidates to the Board,
taking into account the need for the Boards of NV and PLC to be
the same to ensure unity of management. Further information on
these proposals can be found in the notices to the 2006 AGMs.
The Boards are of the view that it is appropriate that the
Chairman is included as a member of the Committee on the
express condition that he did not participate in any discussion of
his own position.
Remit
The primary role of the Committee is the recommendation to the
Boards of candidates for the positions of Director, both Executive
and Non-Executive, and Chairman and Vice-Chairman, and Senior
Independent Director, and this includes a responsibility to concern
itself with succession planning within the Boards. In addition it
has a responsibility for the oversight of all matters relating to
corporate governance, bringing any issues to the attention of the
Boards. Under its remit, the Committee is entitled to use the
services of recruitment consultants and other external experts at
the expense of Unilever. It is also to conduct a process of
evaluation of its own performance each year. The full remit is on
the Unilever website at
www.unilever.com/investorcentre/corpgovernance, as is the
information used by the Committee for succession planning.
Also on that website is The Governance of Unilever, which,
amongst other matters, sets out the procedures for evaluating the
Boards and individual Directors. These are designed to enable the
results of the evaluations to be provided to the Nomination
Committee when it discusses the nominations for election as
Directors of NV and PLC at the next Annual General Meeting.
Meetings of the Committee
The Committee met six times in 2005. It agreed to the separation
of the roles of Chairman and Chief Executive and recommended
to the Boards the appointment of Antony Burgmans as Chairman,
and Patrick Cescau as Group Chief Executive. It also proposed
the nomination of all those Directors offering themselves for
re-election at the 2005 AGMs and to the nomination of Ralph
Kugler as an additional Executive Director.
It carried out the Committee’s annual review of its terms of
reference and performance of its responsibilities and commenced
its evaluation of its performance in 2004.
Succession planning for the Non-Executive Directors, one of
whom retired at the 2005 AGMs and three of whom are retiring
at the 2006 AGMs was also considered by the Committee during
2005. Specialist recruitment firms have been commissioned to
assist in finding individuals with the appropriate skills and
expertise who will be nominated as Non-Executive Directors at the
AGMs in 2006 and 2007.
During 2005, the Committee also commenced the search for a
new Chairman to succeed Antony Burgmans who is due to retire
in 2007. A well-reputed search firm has been commissioned by
the Committee to assist them in this process. Further work on this
will be carried out during 2006.
2005 was the first year of our new Boards’ operation. To ensure
optimal functioning of the Boards and the individual Directors and
compliance with the most recent developments in best practice,
the Nomination Committee commissioned Spencer Stuart to carry
out a full review of the functioning of the Boards and of their
governance arrangements. This review concluded that our
arrangements stood comparison with our peers. A full report was
made to the Boards in the first quarter of 2006 and a range of
minor changes in terms of the day-to-day operations of the
Boards will be introduced during the balance of the year. A Board
evaluation and Chairman and individual director appraisal process
is scheduled for 2006. Thus, the changes following the said
review can be taken into account in the evaluations.
The Committee also met early in 2006. It decided to nominate all
those Directors offering themselves for re-election at the 2006
AGMs and four new Directors to be appointed as Non-Executive
in place of Claudio Gonzalez who retired at the 2005 AGMs and
of Bertrand Collomb, Oscar Fanjul and Hilmar Kopper who are
retiring at the 2006 AGMs. The new Non-Executive Directors were
chosen specifically for their financial and/or general business
expertise.
The Committee’s annual Report to Shareholders was approved.
Bertrand Collomb Chairman of the Nomination Committee
Antony Burgmans
David Simon
Jeroen van der Veer