BT 2011 Annual Report Download - page 85

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REPORT OF THE DIRECTORS
Election and re-election
All directors are required by BT’s Articles of Association to be
elected by shareholders at the first annual general meeting (AGM)
after their appointment, if appointed by the Board. A director must
subsequently retire by rotation at an AGM at intervals of not more
than three years. The director may seek re-election.
Nick Rose and Jasmine Whitbread, having been appointed as
directors by the Board, will retire at the 2011 AGM and will be
proposed for election. In line with the New Code, the Board has
decided that all other directors except Clay Brendish, will be
proposed for re-election. Clay, whose appointment will end on
31 August 2011 will then retire from the Board. Details of these
directors’ contracts/letters of appointment are included in the
Report on directors’ remuneration.
The chairman reviewed the performance of each director and
found that each of them makes an effective contribution to the
deliberations of the Board and continues to demonstrate
commitment to the role. The Chairman’s performance was
reviewed by the senior independent director.
Meetings attendance
The following table shows the attendance of directors at meetings
of the Board and
Audit & Risk, Nominating & Governance and
Remuneration Committees during the 2011 financial year.
Nominating &
Audit & Risk Governance Remuneration
Board Committee Committee Committee
Number of meetings held
10646
Number of meetings attended (maximum possible)
Sir Michael Rakea9 (10) – 4 (4) 1 (1)
Ian Livingston 10 (10) – – –
Tony Chanmugam 10 (10) – – –
Gavin Patterson 10 (10) – – –
Clay Brendish 9 (10) 6 (6) 4 (4) –
Carl Symon 10 (10) 6 (6) – 6 (6)
Phil Hodkinson 9 (10) 6 (6) 3 (4) –
Patricia Hewitt 8 (10) 6 (6) 3 (4) 6 (6)
Eric Daniels 9 (10) – 4 (4) 6 (6)
Tony Ball 10 (10) – 4 (4) –
Nick Roseb2 (2) – – –
Jasmine Whitbreadc2 (2) – – –
aSir Michael Rake ceased to be a member of
Remuneration Committee on 31 May 2010.
bNick Rose was appointed to the Board on 1 January 2011.
cJasmine Whitbread was appointed to the Board on 19 January 2011.
The Board keeps under review the level of attendance, and
contribution by directors at Board meetings and the Chairman
meets with non-executive directors on an individual basis.
Service agreements
The Chairman and executive directors have service agreements, the
terms of which are approved by the
Remuneration Committee .
Information about the periods of these contracts is in the Report on
directors’ remuneration.
Training and information
On appointment, directors take part in an induction programme
when they receive information about BT, the role of the Board and
the matters reserved for its decision, the terms of reference and
membership of the main Board committees, and the powers
delegated to those committees, BT’s corporate governance policies
and procedures, including the powers reserved to the group’s most
senior executives, and the latest financial information. Since
appointment in January 2011, Nick Rose and Jasmine Whitbread
have met with the Operating Committee members. They have also
had a series of meetings with other key senior executives across the
company and in relation to committee memberships, specific
briefings have taken place.
Directors are continually updated on BT’s business, the competitive
and regulatory environments in which it operates, technology and
corporate responsibility matters and other changes affecting BT and
the communications industry as a whole, by written briefings and
meetings with senior BT executives. The Board has an annual
strategy meeting, with regular reviews during the year. Directors
are also advised on appointment of their legal and other duties and
obligations as a director of a listed company, both in writing and in
face-to-face meetings with the Company Secretary. They are
reminded of certain obligations each year and they are also
updated on changes to the legal, accounting and governance
requirements affecting the company and themselves as directors.
During the 2011 financial year, for example, the Board received
briefings on changes to UK company law and on various corporate
governance matters through regular Secretary’s Reports. The
Chairman also sends a weekly email to non-executive directors
which includes topical sector highlights and updates on key
business activities.
Guidelines govern the content, presentation and delivery of papers
for each Board meeting, so that the directors have enough
information to be properly briefed sufficiently far ahead of each
Board meeting and at other appropriate times, and to take account
of their duties as directors.
Independent advice
The Board has a procedure for directors, in carrying out their duties,
to take independent professional advice if necessary, at BT’s
expense. All directors also have access to the advice and services of
the Company Secretary.
Directors’ and officers’ liability insurance and
indemnity
For some years, BT has purchased insurance to cover the directors
and officers of BT Group plc and its subsidiaries (and the BT
nominated directors of associated companies and joint ventures)
against defence costs and civil damages awarded following an
action brought against them in that capacity. The insurance
operates to protect the directors and officers directly in
circumstances where by law BT cannot provide an indemnity and
also provides BT, subject to a retention, with cover against the cost
of indemnifying a director or officer. One layer of the programme is
ringed-fenced for the directors of BT Group plc. The cover has been
extended to provide limited cover for civil fines and penalties. At
the date on which this report was approved, and throughout the
2011 financial year, the company’s wholly owned subsidiary, British
Telecommunications plc, has provided an indemnity in respect of a
similar group of people who would be covered by the above
insurance. Neither the insurance nor the indemnity provides cover
where the person has acted fraudulently or dishonestly.
Interest of management in certain transactions
During and at the end of the 2011 financial year, none of BT’s
directors was materially interested in any material transaction in
relation to the group’s business and none is materially interested in
any presently proposed material transactions.
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