Unilever 2005 Annual Report Download - page 41

38 Unilever Annual Report and Accounts 2005
Corporate governance
(continued)
Role and Responsibility
The key elements of the role and responsibilities of our
Non-Executive Directors are:
• supervision of and advice to the Group Chief Executive;
• developing strategy with the Group Chief Executive;
• scrutiny of performance;
• controls;
• reporting of performance;
• remuneration of and succession planning for Executive
Directors; and
• governance and compliance.
Our Non-Executive Directors are chosen for their broad and
relevant experience and international outlook, as well as their
independence. They form the Audit Committee, the Nomination
Committee, the Remuneration Committee and the External
Affairs and Corporate Relations Committee. The roles and
membership of these key Board committees are described on
page 39. The profile set by the Boards for the Non-Executive
Directors and the chart used for orderly succession planning can
be seen on our website at
www.unilever.com/investorcentre/corpgovernance.
Meetings
The Non-Executive Directors meet regularly as a group, without
the Executive Directors present, under the chairmanship of the
Senior Independent Director. In 2005 they met three times as a
group. In addition, the Non-Executive Directors usually meet
before each Board meeting with the Chairman, the Group Chief
Executive and the Joint Secretaries.
Senior Independent Director
Our Non-Executive Directors have appointed Bertrand Collomb as
Senior Independent Director. He acts as their spokesman. The
Senior Independent Director is consulted by the Chairman on the
agenda and arrangements for Board Meetings. He is also, in
appropriate cases, a point of contact for shareholders and other
stakeholders. In 2005 Bertrand Collomb was appointed Vice-
Chairman of NV and PLC. Mr Collomb will be retiring at the
AGMs in 2006.
Tenure
Our Non-Executive Directors submit themselves for re-election
each year. Their nomination for re-election is subject to continued
good performance which is evaluated by the Boards, based on
the recommendations of the Nomination Committee. The
Nomination Committee carefully considers each nomination for
reappointment. The Non-Executive Directors normally serve for a
maximum of nine years.
Remuneration
The remuneration of the Non-Executive Directors is determined by
the Boards, within the overall limit set by the shareholders at the
AGMs in 2004, and it is reported on page 68. Details of the
engagement of our Non-Executive Directors can be seen on the
Unilever website at
www.unilever.com/investorcentre/corpgovernance.
Independence
Taking into account the role of Non-Executive Directors, which is
essentially supervisory, and the fact that they make up the key
committees of the Board, it is important that our Non-Executive
Directors can be considered to be independent.
Our definition of ‘independence’ for Directors is set out in The
Governance of Unilever. It is derived from the applicable
definitions in use in the Netherlands, UK and US. Our current
Non-Executive Directors are considered to be independent of
Unilever, with the exception of Antony Burgmans. Our Boards
reached this conclusion after conducting a thorough review of all
relevant relationships of the Non-Executive Directors, and their
related or connected persons.
A number of relationships, such as non-executive directorships,
exist between several of our Non-Executive Directors and
companies that provide banking, insurance or financial advisory
services to Unilever. Our Boards considered in each case the
number of other companies that also provide or could readily
provide such services to Unilever, the significance to those
companies of the services they provide to Unilever, the roles of
the Non-Executive Directors within those companies and the
significance of that role to our Non-Executive Directors. It
concluded that none of these relationships threaten the
independence of the Non-Executive Directors concerned.
For example, the Boards have satisfied themselves that Leon
Brittan’s position at UBS Investment Bank does not involve him in
any way in its broking relationship with Unilever. They have noted
that Lynda Chalker’s involvement in consultancy services for
Unilever had been terminated before she was elected a Non-
Executive Director in May 2004. The Boards have formed the view
that the fact that Antony Burgmans is a member of the Supervisory
Board of ABN AMRO, and David Simon is Senior Advisor of
Morgan Stanley Dean Witter, was not material. The Board
considers that the Chairmanship of Bertrand Collomb and the
Non-Executive Directorship of Oscar Fanjul, and Lynda Chalker's
membership of the International Advisory Board, of Lafarge, do
not affect their status as independent in relation to their Non-
Executive Directorships of Unilever.
Antony Burgmans, who before May 2005 was an Executive
Director, is not considered to be independent. The Nomination
Committee and the Boards nominated him for election as a Non-
Executive Director in 2005 because of his thorough knowledge of
Unilever and its operations. In addition to his role as Chairman,
the Boards considered his knowledge of the business to be
essential to see through the changes resulting from the structure
review. We expect Antony Burgmans to be succeeded by an
independent Chairman in 2007.
None of our Non-Executive Directors are elected or appointed
under any arrangement or understanding.