Unilever 2010 Annual Report Download - page 45

42 Unilever Annual Report and Accounts 2010
Report of the Directors Governance
Our Governance Structure and the Boards continued
The Boards
The Boards are responsible for the long-term success of Unilever
andare accountable to their respective shareholders for the
performance of the business.
It is of profound significance for Unilever, with its dual structure
of two parent companies and two different shareholder
constituencies, that it is able to operate effectively asa single
economic entity. This objective is achieved by securing unity
ofmanagement of NV and PLC.
It has always been a requirement of Unilever that the same
people be on the Boards of the two parent companies. This
ensures that all matters are considered by the Boards as a single
intellect, reaching the same conclusions on the same set of
factssave where specific local factors apply. It is essential that in
reaching the same decisions the NV and PLC Boards identify and
resolve any potential conflicts of interest between NV and PLC.
This is of significance both to the strategic and the day-to-day
operation of Unilever. It ensures that Unilever achieves the
substance of a single parent group but without the form.
The Boards are one-tier boards, comprising Executive Directors
and, in a majority, Non-Executive Directors. The Boards have
ultimate responsibility for the management, general affairs,
direction and performance and long-term success of our business
as a whole. The responsibility of the Directors is collective, taking
into account their respective roles as Executive Directors and
Non-Executive Directors.
The Boards are responsible for the overall conduct of the Group,
including the management, direction and performance of NV and
PLC. The Boards have, with the exception of certain matters
which are reserved for them, delegated the operational running
of the Group to the Chief Executive Officer. The Chief Executive
Officer is responsible to the Boards as a whole, and is in turn able
to sub-delegate any of his powers and discretions. Matters
reserved for the Boards include structural and constitutional
matters, corporate governance, approval of dividends, approval
of overall strategy for the Group and approval of significant
transactions or arrangements in relation to mergers, acquisitions,
joint ventures and disposals, capital expenditure, contracts,
litigation, financing and pensions.
The Boards have also established committees whose actions are
regularly reported toand monitored by the Boards, and these are
described on pages 47 and 48. Further details of how our Boards
effectively operate as one board, govern themselves and delegate
their authorities, are set out in the document entitled
‘TheGovernanceof Unilever’, which can be found at
www.unilever.com/investorrelations/corp_governance.
Board meetings
There is a minimum of five meetings held throughout the
calendar year. These are comprised of quarterly meetings,
toconsider the results statements of the Group, and a meeting
toapprove the Annual Report and Accounts. Board meetings
arealso held to discuss matters such as Group strategic issues
and the Financial Plan.
In addition to the above, our Boards will consider during the year
important corporate events and actions, such as:
• oversight of the performance of the business;
• review of risks and controls;
• authorisation of major transactions;
• declaration of dividends;
• convening of shareholders’ meetings;
• nominations for Board appointments;
• approval of Board remuneration policy;
• review of the functioning of the Boards and their
Committees;and
• Corporate Social Responsibility.
Our risk management approach and associated systems of
internal control are of upmost importance to the Boards and
aredescribed further on pages 33 to 39.
Meetings of the Boards may be held either in London or
Rotterdam or such other locations as the Boards think fit,
withone or two off-site Board meetings a year.
Board induction, training and support
Upon election, Directors receive a comprehensive Directors’
Information Pack and are briefed thoroughly on their
responsibilities and the business. Ongoing training is provided
forDirectors by way of site visits, presentations, circulated
updates, and teach-ins at Board or Board Committee meetings
on,among other things, Unilever’s business, environmental,
socialand corporate governance, regulatory developments and
investor relations matters. In 2010, Board meetings were held at
the offices of Unilever in both São Paulo in Brazil and Hamburg
inGermany. In both locations the Boards visited Unilever factories
and learnt more about the supply chain in both these regions,
and in Brazil included customer visits to local retail outlets. Visits
such as these allow the Non-Executive Directors to meet senior
managers around Unilever’s global business and in turn allow
them to gaina deeper understanding of the business.
A procedure is in place to enable Directors, if they so wish,
toseek independent advice at Unilever’s expense.