Aviva 2013 Annual Report Download - page 76

Aviva plc
Annual report and accounts 2013
74
Directors’ and Corporate governance report continued
Mackenzie, Chief Marketing and Communications Officer, is a
Non-Executive Director of Mothercare Plc.
Other activities
During the year the committee reviewed the composition of the
Board’s committees and recommended changes to the Board
for approval. In addition the committee made the
recommendation to appoint Sir Adrian Montague as the Senior
Independent Director following the retirement of Richard Goeltz
from the Board. The committee was involved in the process to
recruit a new Chief Executive Officer for Aviva Investors which
resulted in the appointment of Euan Munro who joined in
January 2014. Several committee members met Christine
Deputy prior to her appointment as Group HR Director and the
committee discussed potential candidates to succeed the Chief
Executive Officer of Aviva Canada and provided advice on
executive succession matters to the Group CEO.
The committee reviewed and agreed to John McFarlane’s
appointment as Chairman of FirstGroup plc, taking into account
the time commitment involved. The committee also reviewed
the independence of each NED, all directors’ conflicts of interest
and the balance of skills, knowledge, experience and diversity
on the Board prior to recommending the directors’ election or
re-election at the AGM. Following consideration of these issues
the committee recommended each director standing for
election or re-election at the 2014 AGM. Following Patrick
Regan’s resignation in January 2014, the committee appointed
Spencer Stuart to search for suitable CFO candidates. Spencer
Stuart also carries out other executive search activities for
the Group.
Committee performance and effectiveness
The Board undertook an annual review of the committee’s
performance and effectiveness as part of the Board
effectiveness review and the results of the review will be
incorporated into the committee’s processes and activities
for 2014.
Audit Committee report
Committee role and responsibilities
The purpose of the committee is to assist the Board in
discharging its responsibilities for monitoring the integrity of the
Group’s financial statements, assessing the effectiveness of the
Group’s system of internal controls and monitoring the
effectiveness, performance, independence and objectivity of the
internal and external auditors. Whilst the Board as a whole has a
duty to act in the best interests of the Company, the committee
has a particular role, acting independently of management, to
ensure that the interests of shareholders are properly protected
in relation to financial reporting and the effectiveness of the
Group’s systems of financial internal controls. The key
responsibilities of the committee are to:
 Review the significant issues and judgements of
management, and the methodology and assumptions used
in relation to the Group’s financial statements, and formal
announcements on the Group’s financial performance,
including the reserving position relating to the Group’s life
assurance and general insurance operations
 Review the Group’s going concern assumptions
 Assess the effectiveness of the Group’s system of internal
controls, including financial reporting, financial controls and
the Internal Audit function
 Consider and review the performance of the Chief Audit
Officer (CAO), and agree with management his effectiveness
and his remuneration
 Consider and make recommendations to the Board on the
appointment, reappointment, dismissal or resignation,
effectiveness and remuneration of the external auditor
 Assess the independence and objectivity of the external
auditor
Revised terms of reference for the committee were adopted in
December 2013 following an annual refresh. 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 independent NEDs only. The Group
Company Secretary acts as the secretary to the committee. 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
Russell Walls (Chairman2) 6 100%
Glyn Barker (Chairman3) 13 100%
Patricia Cross4 1 100%
Richard Karl Goeltz5 6 100%
Sir Adrian Montague6 9 90%
Michael Hawker 13 100%
1 This shows the percentage of meetings which the committee member attended during the year whilst a
member of the committee.
2 Russell Walls chaired the committee until 8 May 2013 when he retired from the Board.
3 Glyn Barker became chairman of the committee on 8 May 2013.
4 Patricia Cross joined the committee on 1 December 2013.
5 Richard Karl Goeltz retired from the Board on 8 May 2013.
6 Sir Adrian Montague joined the committee on 6 March 2013 and was unable to attend one meeting which
was called at short notice.
The committee met on 13 occasions in 2013, of which three
meetings were called at short notice. During the year the
committee members attended meetings of business unit audit
committees in UK Life, Ireland Life, Ireland Health, Aviva
Investors, Canada, France and Italy.
The Chairman, Group CEO, CFO, CAO and the external
auditor normally attended committee meetings. Other members
of senior management were also invited to attend as
appropriate to present reports. During the year the committee