1.Constitution
The Committee has been established by resolution of the Board held on 30 June 1999 and is known as the Nomination Committee. These terms of reference were adopted by the Board on 29 October 2003 and may be amended from time to time, subject to the approval of the Board.
2.Membership
2.1
The members of the Nomination Committee shall be appointed by the Board from amongst the directors of the Company and shall consist of not less than three members. A majority of the members of the Nomination Committee shall be independent non-executive directors of the Company.
2.2
The chairman shall be either the chairman of the Board or an independent non-executive director of the Company. The chairman of the Board shall not chair the Nomination Committee when the Nomination Committee is dealing with the appointment of the Board chairman's successor. In the absence of the Nomination Committee chairman and/or an appointed deputy, the remaining members present shall elect one of the independent non-executive members present to the chair the meeting.
2.3
A quorum shall consist of the chairman of the Board for the time being together with not less than any two of the non-executive directors of the Company. A duly convened meeting of the Nomination Committee at which a quorum is present shall be competent to exercise all or any of the powers, authorities and discretions vested in or exercisable by the Nomination Committee.
2.4
The Company Secretary shall act as the secretary of the Nomination Committee.
2.5
No one other than the Nomination Committee chairman and members is entitled to be present or vote at a meeting of the Nomination Committee, although executive directors, members of senior management and other parties may attend if invited to do so by the Nomination Committee.
3. Frequency of meetings
Meetings shall normally be held at such times as the Nomination Committee deems appropriate, and in any event shall be held not less than once a year. The chairman of the Company may request a meeting if he/she considers that one is necessary.
4.Authority
4.1
The Nomination Committee is authorised by the Board at the expense of the Company to investigate any matter within its terms of reference. It is authorised to seek any information it requires from any employee and all employees are directed to co-operate with any requests made by the Nomination Committee.
4.2
The Nomination Committee is authorised by the Board at the expense of the Company to obtain outside professional advice and to secure the attendance of outsiders with relevant experience and expertise if it considers this necessary. It is envisaged that in obtaining outside advice the Nomination Committee will act in conjunction with the chairman of the Company.
5.Purpose
The purpose of the Nomination Committee is to comply with Principle A.5.1 of the Combined Code and make recommendations to the Board on the appointment of new executive and non-executive directors, including making recommendations as to the composition of the Board generally and the balance as between executive and non-executive directors appointed to the Board.
6.Duties
6.1
The Nomination Committee shall be responsible for all aspects of the appointment of directors of the Company and the duties of the Nomination Committee shall be:
6.1.1
The Nomination Committee is authorised by the Board at the expense of the Company to obtain outside professional advice and to secure the attendance of outsiders with relevant experience and expertise if it considers this necessary. It is envisaged that in obtaining outside advice the Nomination Committee will act in conjunction with the chairman of the Company.
6.1.2
to carry out the decisions of the Board in relation to the appointment of new directors to the Board;
6.1.3
to be responsible for identifying and nominating candidates for the approval of the Board to fill Board vacancies as and when they arise as well as put into place plans for succession as described below;
6.1.4
before beginning to search for candidates for a particular appointment, to prepare a written description of the role and capabilities required for that appointment having evaluated the balance of skills, knowledge and expertise already on the board;
6.1.5
to establish procedures for the appointment of directors which shall include procedures for communicating with the chairman and the chief executive of the Company about any proposed appointment;
6.1.6
to consider candidates for Board appointments on merit and according to objective criteria;
6.1.7
to satisfy itself with regard to succession planning, that processes and plans are in place with regard to both Board and senior management appointments that take into account the challenges and opportunities facing the Company and therefore what skills and expertise are needed on the Board in future and to make recommendations to the Board as regards succession planning for both executive and non-executive directors;
6.1.8
to settle job specifications and written terms of appointment for directors;
6.1.9
to ensure that on appointment, all non-executive directors receive formal written terms of appointment;
6.1.10
to seek advice from outside advisors in relation to any appointments and use open advertising, if appropriate, in relation to any appointments, having regard to the requirement to give an explanation in the annual report if neither external consultants nor open advertising have been used;
6.1.11
to review a candidate's other commitments and ensure that, on appointment, a candidate has sufficient time to undertake the role and review the position annually thereafter. In particular, if the candidate is a full-time executive director of another company, to ensure that his appointment to the Company is his sole non-executive appointment and that he is not chairman of a FTSE 100 company;
6.1.12
to develop a comprehensive and formal induction programme for new Board directors;
6.1.13
to consider candidates from a wide range of backgrounds and to regularly review the Board structure, age profile, size, and composition, and make recommendations to the Board in relation to any appointments and adjustments (including any alterations to executive or non-executive status) that are deemed necessary;
6.1.14
to keep under review the leadership needs of the organisation, both executive and non-executive, with a view to ensuring the continued ability of the Company to compete efficiently in the marketplace;
6.1.15
to make recommendations regarding the membership of the Audit Committee in consultation with the chairman of the Audit Committee;
6.1.16
to review the time needed to fulfil the role of Chairman, senior independent director and non executive director, and assist in the annual performance evaluation to ensure that all members of the Board have devoted sufficient time to their duties;
6.1.17
to investigate and make recommendations to the Board concerning any matters relating to the continuation in office as a director of any director at any time;
6.1.18
as regards the re-appointment of any non-executive director, to review performance and to make a recommendation to the Board, at the conclusion of his or her specified term of office; particularly once a second term of office has been completed. Non-executive directors who have been on the board for six years will not be automatically re-appointed, but will be subject to rigorous review and to take into account the need for progressive refreshing of the Board;
6.1.19
to make recommendations to the Board concerning the re-election by shareholders of any directors under the retirement by rotation provisions in the Company's articles of association;
6.1.20
to recommend the continuation (or not) in service of any director who has reached the age of 70;
6.1.21
to ensure that items that should be published in the Company's Annual Report relating to the activities of the Nomination Committee, are included in that Report;
6.1.22
to review and, where necessary, update these terms of reference (subject to the approval of the Board) and make them publicly available; and
6.1.23
to have regard to the Combined Code in relation to any recommendation for appointments.
7.Annual general meeting
The chairman of the Nomination Committee shall be available at the Annual General Meeting to answer questions on the Nomination Committee's practice and procedures.
8.Proceedings
8.1
Unless varied by these terms of reference, meetings and proceedings of the Nomination Committee will be governed by the Company's Articles of Association regulating the meetings and proceedings of directors.
8.2
Except under exceptional circumstances, at least 48 hours' notice will be given of a meeting of the Nomination Committee. Such notice will include the agenda and any supporting papers.
8.3
The Secretary of the Nomination Committee shall circulate the minutes of the meetings of the Nomination Committee to all members of the Committee and, if the chairman so decides, to all members of the Board.
8.4
The Secretary of the Nomination Committee shall summon Nomination Committee meetings at the request of the chairman of the Company or as otherwise provided by these terms of reference.
October 2003