Unilever 2008 Annual Report Download - page 52

Unilever Annual Report and Accounts 2008 49
Report of the Directors
Corporate governance continued
Remuneration Committee
The Remuneration Committee reviews Directors’ remuneration
and is responsible for the executive share-based incentive plans.
It determines, within the parameters set by our shareholders,
specific remuneration arrangements for each of the Executive
Directors, the remuneration scales and arrangements for Non-
Executive Directors and the policy for the remuneration of the tier
of management directly below the Boards. The Committee is
advised by the Group Secretary on matters of corporate
governance.
The document entitled ‘The Governance of Unilever’ sets out that
the Committee comprises a minimum of three independent Non-
Executive Directors. The Remuneration Committee is chaired by
David Simon and its other members are Jeroen van der Veer and
Michael Treschow. Following David’s retirement at the end of the
2009 AGMs, it is intended that Jeroen van der Veer will succeed
him as Chairman of the Remuneration Committee.
The following table shows the attendance of Directors at
Remuneration Committee meetings for the year ended
31 December 2008:
Name Attendance
David Simon (Chairman) 5 of 5
Michael Treschow (from 6 February 2008) 4 of 4
Jeroen van der Veer 3 of 5
Attendance is expressed as number of meetings attended out of
number eligible to attend.
The detailed report of the Remuneration Committee to the
shareholders on Directors’ remuneration is on pages 60 to 73.
Corporate Responsibility and Reputation Committee
The Corporate Responsibility and Reputation Committee has
responsibility for the oversight of Unilever’s conduct with regard
to its corporate and societal obligations and its reputation as a
responsible corporate citizen. It comprises a minimum of three
Non-Executive Directors. It is chaired by Leon Brittan and its other
members are Narayana Murthy and Hixonia Nyasulu. Ralph Kugler
and Geneviève Berger stepped down as members of the
Committee on 15 May 2008 and 30 June 2008 respectively.
The following table shows the attendance of Directors at
Corporate Responsibility and Reputation Committee meetings for
the year ended 31 December 2008:
Name Attendance
Leon Brittan (Chairman) 4 of 4
Geneviève Berger (to 30 June 2008) 2 of 2
Ralph Kugler (to 15 May 2008) 2 of 2
Narayana Murthy 2 of 4
Hixonia Nyasulu 4 of 4
Attendance is expressed as number of meetings attended out of
number eligible to attend.
See page 75 for the Report of the Corporate Responsibility and
Reputation Committee to shareholders.
Routine business committees
Committees are also set up to conduct routine business as and
when they are necessary. They comprise any two of the Directors
and certain senior executives and officers. They administer or
implement certain matters previously agreed by our Boards or the
Chief Executive Officer. The Group Secretary is responsible for the
operation of these committees.
Disclosure Committee
The Boards have set up a Disclosure Committee which is
responsible for helping the Boards ensure that financial and
other information required to be disclosed publicly is disclosed in a
timely manner and that the information that is disclosed
is complete and accurate in all material aspects. The Committee
comprises the Group Controller, the Group Secretary, the Chief
Legal Officer and the Group Treasurer.
Director matters
Conflicts of interest
We attach special importance to avoiding conflicts of interest
between NV and PLC and their Directors. The Boards are
responsible for ensuring that there are rules in place to avoid
conflicts of interest by Board members. Conflicts of interest are
understood not to include transactions and other activities
between companies in the Unilever Group.
At the 2008 AGM shareholders approved amendments to Unilever
PLC’s Articles of Association to reflect certain provisions of the UK
Companies Act 2006 relating to conflicts of interest that came into
force on 1 October 2008, enabling the Board to authorise conflicts
or potential conflicts of interest. Following the change of law, the
interests of Directors and their connected persons were reviewed
by the Boards. Authorisation of situational conflicts was given by
the Boards to the relevant Director in accordance with the Articles
of Association of PLC. The authorisation included conditions
relating to keeping Unilever information confidential and to the
exclusion from receiving and discussing relevant information at
Board meetings. Situational conflicts will be reviewed annually by
the Boards as part of the determination of Director independence.
In between those reviews Directors have a duty to inform the
Boards of any relevant changes to the situation. The procedures
that Unilever has put in place to deal with conflicts of interest
have operated effectively.
Various formal matters
The borrowing powers of NV Directors on behalf of NV are not
limited by the Articles of Association of NV. PLC Directors have the
power to borrow on behalf of PLC up to three times the adjusted
capital and reserves of PLC, as defined in its Articles of
Association, without the approval of shareholders (any exceptions
requiring an ordinary resolution).
The Articles of Association of NV and PLC do not require Directors
of NV or Directors of PLC to hold shares in NV or PLC. However,
the remuneration arrangements applicable to our Executive
Directors require them to build and retain a personal shareholding
in Unilever equal to at least 150% of their annual base pay.