Aviva 2013 Annual Report Download - page 75

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Aviva plc
Annual report and accounts 2013
73
Directors’ and Corporate governance report continued
Nomination Committee report
Committee role and responsibilities
The Board strongly believes that good governance and strong,
responsible, balanced leadership by the Board are critical to
creating long-term shareholder value and business success.
The committee assists the Board by regularly reviewing the
composition of the Board and conducting a rigorous and
transparent process when recommending or renewing the
appointment of directors to the Board. The key responsibilities
of the committee are to:
 Evaluate and review the structure, size and composition of
the Board including the balance of skills, knowledge,
experience and diversity of the Board, taking into account
the Company’s risk appetite and strategy
 Monitor succession plans for the appointment of non-
executive directors, the Group CEO and other executive
directors to the Board
 Identify and nominate suitable candidates for appointment
to the Board, including chairmanship of the Board and its
committees, and appointment of the Senior Independent
Director, against a specification of the role and capabilities
required for the position, including relevant financial
experience for Audit Committee members
 Assess the independence of each of the NEDs
 Assess directors’ conflicts of interest as they arise
 Review the external interests and time commitments of the
directors to ensure that each has sufficient time to
undertake his/her duties to the Company
 Approve a report on the committee’s activities for inclusion
in the Company’s Annual report and accounts
The full terms of reference for the committee can be found on
the Company’s website at www.aviva.com/terms-of-reference
and are also available from the Group Company Secretary.
Committee membership and attendance
The committee comprises the Chairman and all the Company’s
NEDs. The table below shows the committee members during
the year and their attendance at committee meetings:
Membership and attendance
Committee member
Number of meetings
attended Percenta
g
e attendance1
John McFarlane (Chairman)2 4 80%
Glyn Barker 5 100%
Patricia Cross3 1 100%
Richard Karl Goeltz4 2 100%
Michael Hawker 5 100%
Gay Huey Evans2 4 80%
Michael Mire5 2 100%
Sir Adrian Montague6 4 100%
Bob Stein6 4 100%
Russell Walls4 2 100%
Scott Wheway 5 100%
1 This shows the percentage of meetings which the committee member attended during the year whilst a
member of the committee.
2 John McFarlane did not attend a meeting where his external appointment to FirstGroup plc was the only
agenda item. Gay Huey Evans could not attend an ad hoc meeting called at short notice due to a prior
commitment.
3 Patricia Cross joined the committee on 1 December 2013.
4 Richard Karl Goeltz and Russell Walls retired from the committee on 8 May 2013.
5 Michael Mire joined the committee on 12 September 2013.
6 Sir Adrian Montague and Bob Stein joined the committee on 6 March 2013.
The committee met on five occasions in 2013, of which two
were additional meetings called at short notice due to new
Board appointments during the year. The Group Company
Secretary acts as the secretary to the committee. Members of
the committee took no part in any discussions concerning their
own circumstances. The chairman of the committee reported to
subsequent meetings of the Board on the committee’s work
and the Board received a copy of the agenda and the minutes
of each meeting of the committee.
Committee activities during 2013
During 2013 the committee was principally focused on the
recruitment of new non-executive directors as part of the
continual cycle to refresh the Board and maintain an
appropriate balance of skills, knowledge and experience. These
issues are discussed in detail below. The chart below shows how
the committee allocated its time during 2013.
Nomination Committee – allocation of agenda time
64% Board composition and succession planning
7% Independence and conicts of interest
29% Others (including corporate governance)
Non-executive director search
The committee continued the process to refresh the Board and
engaged The Zygos Partnership and Egon Zehnder to identify
and review suitable candidates. Comprehensive candidate
search briefs were prepared and approved by the committee
and shortlisted candidates were interviewed by the Chairman,
the Senior Independent Director and two NEDs. All the NEDs
had the opportunity to meet with the preferred candidates
before their appointment. Following regulatory approval, the
Board accepted the committee’s recommendations and
appointed Michael Mire and Patricia Cross as NEDs with effect
from 12 September and 1 December 2013 respectively. The
committee considered the cross-directorships of Patricia Cross
and Michael Hawker in Macquarie Group Ltd and Macquarie
Bank Ltd and was satisfied that this did not compromise their
independence.
The Group uses The Zygos Partnership to identify suitable
non-executive director candidates for Group subsidiary
companies and Egon Zehnder for senior executive recruitment.
Diversity
The committee strongly believes that diversity throughout the
Group and at Board and senior management level is a driver of
business success. Diversity brings a broader, more rounded
perspective to decision-making and risk management, making
the Board and senior management more effective. During the
year, candidate searches were conducted and Board
appointments were made, on merit, against the criteria
identified by the committee, having regard to the benefits of
diversity on the Board, including gender. The committee and the
Board believe that diversity also includes criteria such as
nationality, race, age and experience of different businesses.
With the appointment of Patricia Cross there is now 18%
female representation on the Board. The Board remains
committed to achieving a minimum of 25% female
representation on the Board as soon as possible. Recruitment
of a further NED is therefore ongoing and we aim to meet this
target during 2014, which will be ahead of Lord Davies’ target
of 25% by 2015. At the date of this Report, 21% (2012: 29%)
of Group Executive members and 21% (2012: 21%) of senior
executives in the Company were female. It is the Company’s
intention to increase this number as it is recognised that a
greater number of women in senior management will create a
stronger talent pipeline and is better for business. There is also
a policy to encourage senior executives to take up one non-
executive position at other organisations and Amanda