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Business review Performance Governance Financials Additional information
73
Vodafone Group Plc
Annual Report 2012
US listing requirements
As Vodafone’s American depositary shares are listed on the NASDAQ
Stock Market LLC (‘NASDAQ’), we are required to disclose a summary
ofany material differences between the corporate governance
practices we follow and those of US companies listed on NASDAQ. The
corporate governance practices of the Company are primarily based on
UKrequirements but substantially conform to those required of US
companies listed on NASDAQ. The material differences are as follows:
Independence
a Different tests of independence for Board members are applied
under the Code and the NASDAQ rules.
a The Board is not required to, and has not explicitly taken into
consideration, NASDAQ’s detailed denitions of independence
assetout in the NASDAQ rules.
a In accordance with the Code, the Board has carried out an
assessment based on the requirements of the Code and has
determined in its judgement that all of the non-executive directors
(who make up the majority of the Board) are independent within
those requirements.
Committees
a The NASDAQ rules require US companies to have a nominations
committee, an audit committee and a compensation committee,
each composed entirely of independent directors, with the
nominations committee and audit committee required to have
awritten charter that addresses the committees’ purpose and
responsibilities.
a Our Nominations and Governance Committee is chaired by the
Chairman of the Board and its other members are independent
non-executive directors. Our Remuneration Committee is composed
entirely of independent non-executive directors.
a The Audit and Risk Committee is composed entirely of non-executive
directors, each of whom the Board has determined to be
independent, as set out above, and who also meet the requirements
of the Exchange Act.
a We have terms of reference for our Nominations and Governance,
Audit and Risk and Remuneration Committees, which comply with
the requirements of the Code and are available on our website (www.
vodafone.com/governance). These terms of reference are generally
responsive to the relevant NASDAQ rules but may not address all
aspects of these rules.
Code of conduct
Under the NASDAQ rules, US companies must adopt a code of
conductapplicable to all directors, ofcers and employees that
complies with thedenition of a “code of ethics” set out in section 406
ofthe Sarbanes-Oxley Act. We have adopted a Code of Ethics that
complies with section 406 which is applicable only to the senior
nancial and principal executive ofcers, and which is available on our
website (www.vodafone.com/governance). We have also adopted a
separate Code of Conduct which applies to all employees.
Quorum
The quorum required for shareholder meetings, in accordance with our
articles of association, is two shareholders regardless of the level of their
aggregate share ownership, while US companies listed on NASDAQ
arerequired to have a minimum quorum of 33.33% of the shareholders
of ordinary shares for shareholder meetings in accordance with the
NASDAQ rules.
Related party transactions
a In lieu of obtaining an independent review of related party
transactions for conicts of interests in accordance with the NASDAQ
rules, we seek shareholder approval for related party transactions
that meet certain nancial thresholds or where transactions have
unusual features in accordance with the Listing Rules issued by the
FSA in the UK (the ‘Listing Rules’), the Companies Act 2006 and our
articles of association.
a Further, we use the denition of a “transaction with a related party” as
set out in the Listing Rules, which differs in certain respects from the
denition of “related party transaction” in the NASDAQ rules.
Shareholder approval
a We comply with the Listing Rules and the NASDAQ rules, when
determining whether shareholder approval is required for
proposedtransactions.
a Under the NASDAQ rules, whether shareholder approval is required
for transactions depends on, among other things, the percentage of
shares to be issued or sold in connection with a transaction. Under
the Listing Rules, shareholder approval is required, among other
things, when the size of a transaction exceeds a certain percentage
ofthe size of the listed company undertaking the transaction.