The Nominations Committee comprises all of the Non-Executive Directors and is chaired by the Chair of the Board. The Nominations Committee is responsible for leading the process in the selection and appointment of Directors and ensures plans are in place for an orderly succession of Board and senior management positions. Phil Smith has Chaired the Nominations Committee since 28 January 2021.
Principles from the UK Corporate Governance Code
J. Appointments to the board should be subject to a formal, rigorous and transparent procedure, and an effective succession plan should be maintained for board and senior management. Both appointments and succession plans should be based on merit and objective criteria and, within this context, should promote diversity of gender, social and ethnic backgrounds, cognitive and personal strengths.
K. The board and its committees should have a combination of skills, experience and knowledge. Consideration should be given to the length of service of the board as a whole and membership regularly refreshed.
L. Annual evaluation of the board should consider its composition, diversity and how effectively members work together to achieve objectives. Individual evaluation should demonstrate whether each director continues to contribute effectively
The Board shall appoint the members of the Nominations Committee and one of those members to be its Chair.
The Nominations Committee shall consist of not less than three members and will include at least two independent Non-Executive Directors. A quorum shall be two members.
The Chairman of the Nominations Committee shall be appointed by the Board from amongst the independent non-executive directors.
Appointments to the Nominations Committee shall be for a period of up to three years, which may be extended for two further three-year periods.
Frequency of meetings
The Nominations Committee shall meet at least once a year and at such other times as the Chair of the Nominations Committee shall decide.
The Nominations Committee shall:
- regularly review the structure, size and composition (including the skills, knowledge, experience and diversity) of the Board and make recommendations to the Board with regard to any changes
- give full consideration to succession planning for Directors and other senior management, taking into account the challenges and opportunities facing the Company, and the skills and expertise needed on the Board in the future
- keep under review the leadership needs of the organisation, both executive and non-executive, with a view to ensuring the continued ability of the organisation to compete effectively in the marketplace
- keep up-to-date and fully informed about strategic issues and commercial changes affecting the company and the markets in which it operates
- be responsible for identifying and nominating for the approval of the Board, candidates to fill Board vacancies as and when they arise
- before any appointment is made by the Board, evaluate the balance of skills, knowledge, experience and diversity on the Board, and, in the light of this evaluation, prepare a description of the role and capabilities required for a particular appointment - in identifying suitable candidates the Nominations Committee shall:
- use open advertising or the services of external advisers to facilitate the search
- consider candidates from a wide range of backgrounds
- consider candidates on merit and against objective criteria and with due regard for the benefits of diversity on the Board, including gender, taking care that appointees have enough time available to devote to the position
- for the appointment of a Chairman, the Nominations Committee should prepare a job specification, including the time commitment expected. A proposed Chairman’s other significant commitments should be disclosed to the Board before appointment and any changes to the Chairman’s commitments should be reported to the Board as they arise
- prior to the appointment of a Director, the proposed appointee should be required to disclose any other business interests that may result in a conflict of interest and be required to report any future business interests that could result in a conflict of interest
- ensure that, on appointment to the Board, Non-Executive Directors receive a formal letter of appointment setting out clearly what is expected of them in terms of time commitment, committee service and involvement outside Board meetings
- review the results of the Board performance evaluation process that relate to the composition of the Board
- review annually the time required from Non-Executive Directors - performance evaluation should be used to assess whether the Non-Executive Directors are spending enough time to fulfil their duties
- work and liaise as necessary with all other Board Committees.
The Nominations Committee shall also make recommendations to the Board concerning:
- formulating plans for succession for both Executive and Non-Executive Directors and in particular for the key roles of Chairman and Chief Executive
- suitable candidates for the role of Senior Independent Director
- membership of the Audit and Remuneration Committees, and any other Board Committees as appropriate, in consultation with the Chairs of those Committees
- the re-appointment of any Non-Executive Directors at the conclusion of their specified term of office having given due regard to their performance and ability to continue to contribute to the Board in the light of knowledge, skills and experience required
- the re-election by shareholders of Directors under the annual re-election provisions of the Code or as required by the Company’s articles of association, having due regard to their performance and ability to continue to contribute to the Board in the light of the knowledge, skills and experience required and the need for progressive refreshing of the Board (particularly in relation to Directors being re-elected for a term beyond six years)
- any matters relating to the continuation in office of any Director at any time including the suspension or termination of service of an Executive Director as an employee of the Company subject to the provisions of the law and their service contract
- the appointment of any Director to executive or other office.
Where an external search agency has been used, it shall be identified in the annual report and a statement made as to whether it has any connection with the Company. The annual report shall set out the process used to make appointment.
The report referred to above should include a statement of the Board’s policy on diversity, including gender, any measurable objectives that it has set for implementing the policy, and progress on achieving the objectives.