Vodafone 2007 Annual Report Download - page 71

Vodafone Group Plc Annual Report 2007 69
GovernanceGovernance
The Company Secretary ensures that the programme to familiarise the non-
executive directors with the business is maintained over time and kept
relevant to the needs of the individuals involved. The Company Secretary
confers with the Chairman and Senior Independent Director to ensure that
this is the case.
Performance evaluation
Performance evaluation of the Board, its Committees and individual directors
takes place on an annual basis and is conducted within the terms of
reference of the Nominations and Governance Committee with the aim of
improving individual contributions, the effectiveness of the Board and its
Committees and the Group’s performance. In previous years, the evaluation
was internally facilitated.
During the year, the Board conducted, with the assistance of an independent
external facilitator, MWM Consulting, a formal evaluation of its own
performance. The evaluation was designed to determine that the Board was
capable of providing the high level judgement required and that, as a Board,
the directors were informed and up to date with the business and its goals
and understood the context within which it operates. The process adopted
involved the external facilitator separately interviewing each of the directors
and the Company Secretary, with the output from those interviews compiled
into a report prepared by the external facilitator. The Board will continue to
review its procedures, its effectiveness and development in the year ahead.
The Chairman leads the assessment of the Chief Executive and the non-
executive directors, the Chief Executive undertakes the performance reviews
for the executive directors and the Senior Independent Director conducts the
review of the performance of the Chairman. Each Board Committee
undertakes a review of its own work.
The evaluations found the performance of each director to be effective and
concluded that the Board provides the effective leadership and control
required for a listed company. The Nominations and Governance Committee
confirmed to the Board that the contributions made by the directors offering
themselves for re-election at the AGM in July 2007 continued to be effective
and that the Company should support their re-election.
Re-election of directors
Although not required by the Articles, in the interests of good corporate
governance, the directors have resolved that they will all submit themselves
for annual re-election at each Annual General Meeting of the Company.
Accordingly, at the AGM to be held on 24 July 2007, all the directors will be
retiring and, with the exception of Lord Broers who will not offer himself for
re-election, being eligible and on the recommendation of the Nominations
and Governance Committee, will offer themselves for re-election. Vittorio
Colao, Alan Jebson and Nick Land having been appointed to the Board during
the 2007 financial year, and Simon Murray who was recently appointed with
effect from 1 July 2007, are required under the Articles of Association to
submit themselves for election by the Shareholders at the first AGM following
appointment and therefore, being eligible and on the recommendation of the
Nominations and Governance Committee, will retire and offer themselves for
election at the AGM on 24 July 2007.
Independent advice
The Board recognises that there may be occasions when one or more of the
directors feel it is necessary to take independent legal and/or financial advice at
the Company’s expense. There is an agreed procedure to enable them to do so.
Indemnification of directors
In accordance with the Company’s Articles of Association and to the extent
permitted by the law of England and Wales, directors are granted an
indemnity from the Company in respect of liabilities incurred as a result of
their office. In respect of those matters for which the directors may not be
indemnified, the Company maintained a directors’ and officers’ liability
insurance policy throughout the financial year. This policy has been renewed
for the next financial year. Neither the Company’s indemnity nor the
insurance provides cover in the event that the director is proven to have
acted dishonestly or fraudulently.
Company Secretary
The Company Secretary acts as Secretary to the Board and to the
committees of the Board, but the consent of the Board may delegate
responsibility for the administration of the Committees to other suitably
qualified staff. He assists the Chairman in ensuring that all directors have full
and timely access to all relevant information. The Company Secretary is
responsible for ensuring that the correct Board procedures are followed and
advises the Board on corporate governance matters. He also administers the
procedure under which directors can, where appropriate, obtain independent
professional advice at the Company’s expense. The appointment or removal
of the Company Secretary is a matter for the Board as a whole.
Board Committees
The Board has established an Audit Committee, a Nominations and
Governance Committee and a Remuneration Committee, each of which has
formal terms of reference approved by the Board. The Board is satisfied that
the terms of reference for each of these committees satisfy the requirements
of the Combined Code and are reviewed internally on an ongoing basis by the
Board. The terms of reference for all Board committees can be found on the
Company’s website at www.vodafone.com or a copy can be obtained by
application to the Company Secretary at the Company’s registered office.
The committees are provided with all necessary resources to enable them to
undertake their duties in an effective manner. The Company Secretary acts as
secretary to the Nominations and Governance Committee and the Deputy
Group Company Secretary acts as secretary to the Audit Committee and the
Remuneration Committee. The minutes of committee meetings are
circulated to all directors.
Each committee has access to such information and advice, both from within
the Group and externally, at the cost of the Company as it deems necessary.
This may include the appointment of external consultants, where appropriate.
Each committee undertakes an annual review of the effectiveness of its
terms of reference and makes recommendations to the Board for changes
where appropriate.
Audit Committee
The members of the Audit Committee during the year, together with a record
of their attendance at meetings which they were eligible to attend, are set
out below:
Meetings attended
Dr Michael Boskin, Chairman 4/4
Lord Broers 4/4
John Buchanan 4/4
Nick Land (from 1 December 2006) 1/1
Anne Lauvergeon 3/4
Penny Hughes (until 25 July 2006) 1/1
The Audit Committee is comprised of financially literate members having the
necessary ability and experience to understand financial statements. Solely
for the purpose of fulfilling the requirements of the Sarbanes-Oxley Act and
the Combined Code, the Board has designated John Buchanan, who is an
independent non-executive director satisfying the independence
requirements of Rule 10A-3 of the US Securities Exchange Act 1934, as its
financial expert on the Audit Committee. Further details of John Buchanan
can be found in “Governance – Board of Directors and Group Management”.