QBE European Operations plc

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QBE European Operations plc Annual report 2011 38 Governance framework “QBE EO is committed to high standards of corporate governance and has established a practical governance framework.” Ian Beckerson Compliance and Governance Director QBE European Operations Overview and basis of reporting QBE EO’s board governance structure is shown in the chart opposite. Our key committees and their respective roles and responsibilities are summarised on page 40. The committees all comprise appropriately skilled and experienced members and operate under formal terms of reference. As an internal holding company of QBE, our board is not bound by the UK Corporate Governance Code but, as a matter of best practice, seeks to comply with it wherever possible. The financial statements have been prepared in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). The board The board comprises four executive directors and two QBE executive directors. Biographical details for each member of the board are provided on pages 34 and 35. There was one change to the board during the year. Kathy Lisson stepped down from her role as Chief Operating Officer (COO), effective 15 February 2011, to return to her native Canada. On Kathy’s departure, David Winkett was appointed Chief Financial and Operating Officer. The board meets regularly and is chaired by Frank O’Halloran, Chief Executive Officer of QBE Insurance Group Limited. The role of the Chairman is distinct from that of the CEO and the roles are both clearly established. The board has an established policy in relation to the provision of non-audit services by the auditors. The objective is to ensure that the provision of such services does not impair the auditor’s objectivity. Key entities Our board governance structure which details our key operating and regulated entities is outlined on page 39. The boards of these entities each have a schedule of matters reserved for their decision and are responsible for the overall management of the companies. This includes strategic matters, approval of financial statements and dividends, appointments and terminations of directors and auditors, delegation of authority, approval of major capital projects, structure and capital changes and internal controls and risk management. Our non-executive directors sit on the boards of our regulated entities as well as on the Audit Committee and other key committees as shown in the table on page 36. Biographical details for our non-executive directors are also provided on page 36. Our non-executive directors are considered by the board to be independent of management and free from any relationship which could materially interfere with the exercise of their independent judgement. Board performance Board performance is evaluated on an ongoing basis and governance is reviewed to ensure that its performance meets regulatory, legal and business requirements. The board’s committees The board has appointed and authorised a number of committees which operate within established terms of reference. QBE EO’s key committees comprise: • Executive committee; • Audit committee; • Underwriting and reinsurance review committee; • Investment committee; • Reserving committee; • Internal audit committee; and • Risk and capital committee. Further detail on the roles and responsibilities of each of these committees is provided on page 40. Accountability and internal control QBE EO’s activities expose it to a number of risks that could affect its ability to achieve its business objectives. The board, supported by the risk and capital committee, ensures that an appropriate structure for managing these risks is maintained. Since it is neither realistic nor desirable to eliminate risk entirely, the board seeks to ensure that appropriate controls are in place to manage risk effectively and to an agreed level of tolerance. QBE EO’s risk management processes and systems are set out in more detail on pages 20 to 22.
QBE European Operations plc Annual report 2011 39 QBE European Operations – board governance structure QBE EO board QREL board QIEL and QUL combined boards Secura NV board QBE Management Services (UK) Limited board Shareholder communications As an internal holding company, EO plc does not have external shareholders; shareholder communications are, therefore, dealt with by QBE, which sends a half-yearly report to all shareholders who elect to receive it. Reports are available on QBE’s website, www.qbe.com which also contains historical and other details on the Group. Shareholders can discuss their shareholding with the shareholder services department, or the share registrar, both of which are based in Sydney, Australia. The Group’s AGM is held in Sydney each year, usually in April. Shareholders are encouraged to attend the AGM in person, or by proxy. Most resolutions in the notice of meeting have explanatory notes. During the AGM, shareholders may question the Chairman or the external auditor. QBE Global Workplace Diversity Policy With operations in 52 countries, QBE Group recognises that workforce diversity is critical to building and maintaining a workplace that is fair and inclusive. Through QBE’s vision, values and Essential Behaviours, the Group seeks to retain and attract the best people to do the job and to enable them to achieve sustainable high performance. We believe that drawing upon the wide variety of capabilities, ideas and insights of our employees enhances the quality of decision-making and entrepreneurship. The guiding principles of workplace diversity within QBE have been in place for some years. In 2011, QBE undertook a survey of its top 2,500 managers around the world on workplace diversity. As a result of this survey, QBE is planning to introduce a range of initiatives including a new workplace flexibility policy, manager education programmes and development of a “keeping in touch” programme for those taking parental leave. QBE’s workforce diversity policy is aligned with the Essential Behaviours that form our corporate culture, in particular maintaining absolute integrity in all we do. Our aim is to create a workforce that is fair and inclusive and to attract and retain the best people to do the job. Through our Group vision to develop “can do” people who live our Essential Behaviours in everything they do, we will achieve positive business outcomes through the efforts of a strong, cohesive and committed workforce across our global network. To help achieve our workplace diversity initiatives in 2012 and beyond, QBE Group has established a workforce diversity committee, headed by the QBE Group Chief Executive Officer of global underwriting operations. The committee is responsible for monitoring of progress against agreed objectives and reporting to the board to ensure the implementation of this strategic objective in line with the Group’s vision. At QBE EO level, a diversity committee has also been established Corporate governance
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QBE European Operations plc

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