2007 Annual Report - Sappi

Element/Best practice
Sappi application/comments
Independence
Given the strategic operational role
of the chief executive officer, this
function should be separate from
that of the chairperson of the board
Following the resignation of Mr Jonathan Leslie as chief executive officer in
March 2006, the board requested Mr van As, the chairman of the board, to assume
executive responsibility for the group until the appointment of a new chief executive
officer. At the same time Mr D C Brink was appointed senior non-executive director
The position of chief executive officer was separated from that of the chairman of
the board when Mr Boëttger was appointed as the new chief executive officer from
July 2007 and Mr van As handed over his executive responsibilities to Mr Boëttger
during August 2007
Audit committee should consist of
independent board members.
Remuneration committee should
consist of mainly non-executive
members
Majority of independent board members
The chairman should preferably be an
independent non-executive director
The audit committee and the compensation committee both consist entirely of
independent non-executive directors
10 of the 13 board members are independent
As a former chief executive officer and having acted recently again in an executive
capacity, the chairperson Mr van As is not independent. The board believes that
Mr van As is the right chairperson for the company and that the independence
element is met by the strong independent non-executive element on the board.
Mr van As will retire as chairman of the board at the AGM in March 2008
Accountability
Effective subcommittees to assist
the board
To manage its workload, the board will appoint sub-committees with the specific
objective of evaluating key areas of business performance, in particular
governance, on a more detailed basis and to report to the board regularly on any
issues that might arise although it is understood that delegation of responsibilities to
sub-committees does not relieve the board of its ultimate responsibility for the
affairs of the company. The following board committees have been appointed to
deal with specific subjects:
• Nomination and governance committee
• Audit committee
• Compensation committee
• Human Resources committee
Performance related elements should
constitute a substantial portion of the
total remuneration policy
Board and director evaluations
A significant portion of the executive directors’ remuneration consists of a
performance bonus and awards in terms of the Sappi Limited Performance Share
Incentive Scheme to align their objectives with those of stakeholders
The board, through the nomination and governance committee, performs regular
self evaluations of itself, its committees and the contribution of each individual
director. The composition and effectiveness of the board and its committees form
part of this evaluation
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