Barclays 2008 Annual Report Download - page 164

Corporate governance
Corporate governance report
– is willing to stand up and defend their own beliefs and viewpoints
in order to support the ultimate good of the organisation; and
– has a good understanding of the organisation’s business and affairs
to enable them to properly evaluate the information and responses
provided by management.
The Board considers non-executive Director independence on an annual
basis, as part of each Director’s performance review.
The Board Corporate Governance and Nominations Committee and
subsequently the Board reviewed the independence of non-executive
Directors in early 2009 and concluded that each of them continues to
demonstrate these essential behaviours. In determining that each of the
non-executive Directors remains independent, the Board considered in
particular the following:
– Sir Nigel Rudd has served as a non-executive Director since 1996.
The Code suggests that length of tenure is a factor that should be
considered when determining whether a Director continues to be
independent. As recommended by the Code, it is our policy that
any Director who serves for more than nine years should seek annual
re-election by shareholders and that all Directors subject to re-election
should undergo a rigorous performance evaluation.
As a result of the annual performance review, the Board concluded that
Sir Nigel Rudd continues to demonstrate the essential characteristics of
independence expected by the Board. The Board continues to be regularly
refreshed and the Board considers Sir Nigel’s length of service, and the
resulting experience and knowledge of Barclays he has gained, as being
especially valuable. This proved particularly helpful during the difficult
market conditions in 2008. Sir Nigel has stood for re-election annually
at each AGM since 2005. Sir Nigel will, however, retire at the 2009 AGM
and is not seeking re-election.
All Directors must report any changes in their circumstances to the
Board and the Board reserves the right to terminate the appointment
of a non-executive Director if there are any material changes in their
circumstances that may conflict with their commitments as a Barclays
Director or that may impact on their independence. Under UK company
law, a Director must now seek authorisation before taking up any position
with another company that conflicts, or may possibly conflict, with the
Company’s interests. Barclays Articles of Association contain provisions to
allow the Directors to authorise situations of potential conflicts of interest
so that a Director is not in breach of his/her duty under company law.
All existing external appointments for each Director were considered
and authorised by the Board in September 2008 and additional external
appointments have been authorised at subsequent Board meetings
following notification to the Company Secretary. Each authorisation
is set out in a Conflicts Register. The Board Corporate Governance and
Nominations Committee is responsible for conducting an annual review
of the Conflicts Register and confirming to the Board that, where relevant,
conflicts have been dealt with appropriately, and that the process for
dealing with them is operating effectively.
162 Barclays PLC Annual Report 2008 |Find out more at www.barclays.com/annualreport08
Conflicts of Interest
The following Directors’ Duties on Conflicts of Interest set out in the
Companies Act 2006 (the Act) came into force on 1st October 2008:
– a duty not to accept benefits from third parties;
– a duty to avoid a situation in which he has, or can have, a direct or
indirect interest that conflicts, or possibly may conflict, with the
interests of the company (situational conflicts); and
– a duty to disclose any interest in a proposed or existing transaction
or arrangement with the company (transactional conflicts).
Barclays Articles of Association were amended at the 2008 AGM to allow
the Directors to authorise situational conflicts as permitted by the Act.
It is the responsibility of each Director to comply with the Act and
Directors are required to notify Barclays in writing of any new situational
or transactional conflicts. They are also required to consider the interests
of their connected persons in case they amount to an indirect interest.
Details of the potential conflict are submitted to the next Board meeting
and the Directors, excluding the Director to whom the potential conflict
relates, must carefully consider each potential conflict of interest before
it is authorised, if appropriate.