Unilever 2009 Annual Report Download - page 69

66 Unilever Annual Report and Accounts 2009
Report of the Directors Governance
Report of the Nomination Committee
Terms of Reference
The Nomination Committee comprises two Independent Non-
Executive Directors and the Chairman. Following the retirement of
David Simon at the 2009 AGMs, it is chaired by Jeroen van der
Veer. Its other members are Michael Treschow and, following his
appointment at the 2009 AGMs, Paul Walsh. The Group Secretary
acts as secretary to the Committee.
The Nomination Committee is responsible for drawing up selection
criteria and appointment procedures for Directors. Under Unilever’s
corporate governance arrangements Executive and Non-Executive
Directors offer themselves for election each year at the Annual
General Meetings. The Nomination Committee is responsible for
recommending candidates for nomination as Executive Directors,
including the Chief Executive Officer, and Non-Executive Directors
each year based on the process of evaluations referred to below.
After Directors have been appointed by shareholders the
Committee recommends to the Board candidates for election as
Chairman and Vice-Chairman. The Committee also has
responsibility for supervising the policy of the Chief Executive
Officer on the selection criteria and appointment procedures for
senior management and it keeps oversight of all matters relating
to corporate governance, bringing any issues to the attention of
the Boards. The Committee’s Terms of Reference are available on
our website www.unilever.com/investorrelations/corp_governance
Process for the appointment of Directors
Unilever has formal procedures for evaluation of the Boards, the
Board Committees and the individual Directors. The Chairman,
in conjunction with the Senior Independent Director, leads the
process whereby the Board assesses its own performance and the
results of the evaluations are provided to the Committee when it
discusses the nominations for re-election as Directors.
Where a vacancy arises on the Boards, the Committee seeks the
services of specialist recruitment firms and other external experts
to assist in finding individuals with the appropriate skills and
expertise.
In nominating Directors, the Committee follows the agreed Board
Profile of potential Non-Executive Directors, which takes into
account the roles of Non-Executive Directors set out in the Dutch
Corporate Governance Code and the UK Combined Code on
Corporate Governance. Under the terms of The Governance of
Unilever the Boards should comprise a majority of Non-Executive
Directors. To represent Unilever’s areas of interest, the profile also
indicates there should be a strong representation from Developing
and Emerging markets as well as from Europe and North America.
Non-Executive Directors should be independent of Unilever and
free from any conflicts of interest. The profile looks at diversity
in terms of nationality, race, gender and relevant expertise and
directs that, wherever possible, the Boards should reflect Unilever’s
consumer base.
Activities of the Committee during the year
The Committee met six times in 2009. All meetings were attended
by Jeroen van der Veer and Michael Treschow. Paul Walsh
attended two meetings after joining the Committee in May 2009.
The members also regularly met outside of formal Committee
meetings to discuss succession issues.
At the AGMs in May 2009, David Simon retired as a Non-Executive
Director. Jeroen van der Veer succeeded David Simon as
Vice-Chairman, Senior Independent Director and Chairman of the
Nomination Committee from the conclusion of the 2009 AGMs.
The Committee proposed the nomination of all Directors offering
themselves for re-election at the 2009 AGMs. During 2009, the
Committee also proposed the nominations of Louise Fresco, Ann
Fudge and Paul Walsh as Non-Executive Directors at the AGMs in
May 2009. These nominees were chosen to further strengthen the
range of expertise available on the Boards, as well as responding
to our diversity criteria. Ann Fudge and Paul Walsh were
subsequently appointed to the Remuneration Committee and Paul
Walsh was also appointed to the Nomination Committee. In
making these appointments the Committee was supported by an
independent executive search firm chosen by the Committee
which had been engaged to identify suitable candidates for the
roles required.
In 2009 an independent executive search firm chosen by the
committee was also engaged to identify candidates for the role
of Chief Financial Officer, in the light of the resignation of Jim
Lawrence as from the year end. The process resulted in the
Committee’s recommendation to the Boards to nominate
Jean-Marc Huët as Jim Lawrence’s successor. The Committee is
pleased to have identified a strong candidate whose background
and expertise in the corporate and financial world will be
important in helping realise our growth ambitions. Following a
smooth transition Jean-Marc Huët became Chief Financial Officer
in February 2010, and he will be nominated for election as an
Executive Director at the 2010 AGMs.
The Committee received a full presentation of Unilever initiatives
being implemented in 2009 in relation to Senior Leadership
changes and endorsed management’s approach. A successful
diversity programme was considered essential for Unilever and as
part of establishing an articulated performance culture.
The Committee reviewed and approved the external
benchmarking of the capabilities, strengths and opportunities of
the Senior Executives carried out by the Chief Executive Officer
and Chief HR Officer. Periodically throughout the year the
Committee reviewed with the Chief Executive Officer proposed
changes to roles and responsibilities amongst senior executives.
During the year the Committee reviewed the Board profile and
updated the composition, desired expertise and experience and
availability elements of the profile, to reflect the current
requirements of the Boards.
An internal evaluation was undertaken by the Chairman and
Senior Independent Director with the assistance of the Group
Secretary during 2009 in relation to the performance of the
Boards, of the Chairman, of the individual Directors and of the
Board Committees. This evaluation, as in the previous two years,
was based on the completion of questionnaires and a series of
interviews with individual Directors. The Committee has also
carried out an assessment of its own performance, led by the
Committee Chairman.
Supported by an independent executive search firm, the Committee
carried out a search for a new Non-Executive Director and is
delighted that The Rt Hon Sir Malcolm Rifkind MP has agreed to join
our Boards. Sir Malcolm’s experience will further strengthen the
expertise of the Boards particularly in the areas of governance and
reputation. Sir Malcolm will be nominated by the Committee for
election as Non-Executive Director at the 2010 AGMs.
Jeroen van der Veer Chairman of the Nomination Committee
Michael Treschow
Paul Walsh