Marks and Spencer 2007 Annual Report Download - page 37

Corporate governance statement
www.marksandspencer.com/annualreport2007 MARKS AND SPENCER GROUP PLC 35
The Board is committed to achieving long term success for the
Company by building a sustainable business for the long term,
generating shareholder value through consistent, profitable
growth whilst making sure that our customers can always trust
us to do the right thing. This statement explains our governance
policies and practices and provides insight into how the Board
and management run the business for the benefit of shareholders.
The governance rules which apply to all UK companies listed on
the London Stock Exchange are found in the Combined Code
on Corporate Governance which was updated by the Financial
Reporting Council in June 2006 (the ‘Code’). A detailed account
of how we comply with the Code’s principles can be found at
www.marksandspencer.com/investorrelations, together with the
matters reserved to the Board and terms of reference of the
Audit, Remuneration and Nomination Committees.
The Board
Membership
On 1 April 2007 the Board comprised nine directors: the
Chairman, Chief Executive, two executive directors and five
non-executive directors. The five non-executive directors are
all considered by the Board to be independent of management.
Collectively the Board is responsible for the success of
the Company. A full list of the directors, with details of their
biographies and committee membership, is given on page 27.
On 24 January 2007 we announced that Jack Keenan, non-
executive director, will be retiring from the Board following the
AGM to be held on Tuesday 10 July 2007, when he will have
completed two three-year terms as a non-executive director.
On 22 May 2007 we announced the appointment of
Martha Lane Fox as a non-executive director with effect from
1 June 2007. On 25 April 2007 we announced a number of
senior management changes (described on page 10) to position
the Company for the next phase of its growth. Following these
changes, the responsibilities of the executive directors was
re-aligned. Stuart Rose will continue to manage the trading
functions and will add International to his direct reports. With the
store modernisation programme well under way, Ian Dyson will
now be responsible for Store Design and Development and
Procurement, alongside his current responsibilities for Finance,
Property and IT. Steven Sharp remains responsible for Marketing
and the M&S Money relationship with HSBC and will also focus
on the next generation of store design.
Chairman
Lord Burns was appointed Chairman on 11 July 2006, having
joined the Board as Deputy Chairman on 1 October 2005. As
Chairman he leads the Board and is responsible for ensuring its
proper functioning, the balance and mix of its membership,
subject to Board and shareholder approval, and for encouraging
all directors to play their full part in debating matters to deliver
value to shareholders. He ensures effective communication with
shareholders and that Board members have a sound
understanding of the views of all investors. The Chairman also
leads the formal assessment of Board and individual director
performance.
The Chairman ensures that the directors receive accurate, timely
and clear information. Directors are encouraged to update their
skills, knowledge and familiarity with the Group through their
initial induction, on-going participation at Board and committee
meetings, and through meeting our people at store locations
and elsewhere. Views of customers and shareholders are also
shared through Board presentations. The Board is regularly
updated on governance and regulatory matters. There is an
established procedure whereby the Board or any of its
committees may take independent professional advice when
appropriate. Any individual director, wishing to do so in the
furtherance of their duties, may take independent professional
advice through the secretary at the Company's expense. The
Company maintains liability insurance for its directors and
officers. In addition, the directors and secretary have been
granted qualifying third party indemnities.
Chief Executive
Stuart Rose as Chief Executive has delegated authority from the
Board for all aspects of the management of the Group and its
business, which includes developing the appropriate business
strategies for Board approval and achieving timely and effective
implementation. He ensures that, within the strategies agreed by
the Board, appropriate objectives and policies are adopted for
each area of the business, that appropriate budgets are set and
that their performance is effectively managed in keeping with the
Group’s values and business principles. The principal business
unit directors report directly to the Chief Executive and give
regular presentations to the Board on strategies and
performance in their relevant areas of the business.
Senior Independent Director
Sir David Michels succeeded Kevin Lomax as Senior
Independent Director on 1 September 2006. He provides a
communication channel between the Chairman and the non-
executive directors and ensures that the views of each non-
executive director are given due consideration. He is an
additional contact point for shareholders if they have reason for
concern that cannot be addressed through the normal channels
of Chairman, Chief Executive or Finance Director or for which
such contact is inappropriate. He also reviews the Chairman’s
performance on behalf of the Board.
The Non-Executive Directors
The non-executive directors provide a varied range of skills and
experience to the Group. They bring an independent judgement
on issues of strategy, performance, risk and people through
their contribution at Board and committee meetings. The
Chairman concludes that each non-executive director is
independent in character and judgement and that each makes
an effective and valuable contribution to the Board and
demonstrates commitment to the role. Any term beyond six
years (ie two three-year terms) for a non-executive director is
subject to rigorous review.
Following the appointment of new non-executive directors in
February and March 2006 and June 2007, the Board has
reviewed committee membership to refresh the skills,
knowledge and experience of the Audit, Remuneration and
Nomination Committees.
Executive Team Your Board Financial
Review Governance Financials
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