Ophir Energy plc Annual Report and Accounts 2011

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42 Ophir Energy plc Annual Report 2011 Corporate Governance Report continued The Group is committed to the highest standards of business conduct and has adopted a Whistleblowing Policy as a mechanism to support the achievement of this goal. Employees are encouraged to raise genuine concerns which are carefully and thoroughly investigated to assess what action, if any, should be taken. A report is made to the Audit Committee on matters raised in accordance with the Whistleblowing Policy although, during the year to 31 December 2011, no such issues were raised. Report of the HSE Committee Membership, Meetings and Attendance Members of the HSE Committee are appointed by the Board and a majority of its members are independent Non-Executive Directors. Colin Ivory, the Company’s Operations & HSE Manager is invited to attend all meetings of the HSE Committee and external advisors may be invited to attend as necessary. The HSE Committee meets at least twice each year and otherwise as required. During the year ended 31 December 2011 the HSE Committee met three times. Details of HSE Committee membership during the year ended 31 December 2011 and their individual attendance at meetings were as follows: Meeting Committee Members attendance Lyndon Powell (Committee Chairman) 3/3 John Lander 3/3 Patrick Spink (with effect from 7 July 2011) 1/1 Jonathan Taylor 3/3 Role and Responsibilities of the HSE Committee During the year, the HSE Committee reviewed new terms of reference in line with those for UK listed entities and recommended to the Board that the new terms of reference be adopted by the Board. The HSE Committee’s full terms of reference are available on the Company’s website (www.ophir-energy.com) and its main responsibilities include to: –– evaluate the effectiveness of the Group’s policies and systems for identifying and managing health, safety, social, security and environmental risks within the Group’s operations and assess the performance of the Group with regard to the impact of its HSE decisions; –– receive, on behalf of the Board, reports from management concerning all fatalities and serious accidents within the Group and actions taken by management as a result; –– review external stakeholder reporting concerning health, safety, security, social and environmental performance and issues; and –– review the results of independent audits of the Group’s performance in regard to health, safety, social, security or environmental matters, and to review any strategies and action plans developed by management in response to issues raised. Activities of the HSE Committee during the year The principle issue considered by the HSE Committee during the year ended 31 December 2011 has been the review of maritime security in relation to the Group’s operations, particularly off Tanzania and Senegal. A reduction in piracy activity has been seen in Tanzania although support has been provided by the Tanzanian Navy for the drilling and seismic study surveys undertaken. In contrast, Senegal had experienced an increase in security issues and the Company had developed a maritime security plan for Senegal in conjunction with Salamanca Risk Management and HASSMAR, the Senegalese government agency for maritime security and offshore environmental activities. The review of maritime security has led, in turn, to consideration by the HSE Committee of the Group’s crisis management and press briefing procedures, although only minor changes were required. During the year, the HSE Committee has also considered reports on health & safety incidents within the Group, including a particular focus on lost time injuries, and the results of any investigations undertaken. The HSE Committee also reviewed the results of HSE audits undertaken during the year, which led to an update to the Group’s air travel policy, and the approval of the 2012 HSE budget for submission to the Board. Report of the Nomination Committee Membership, Meetings and Attendance Members of the Nomination Committee are appointed by the Board and all three of its members are considered to be independent. The Nomination Committee meets at least twice each year and otherwise as required. During the year ended 31 December 2011 the Nomination Committee met eight times. During the year ended 31 December 2011 the members of the Nomination Committee, and their attendance at meetings, were as follows: Meeting Committee Members attendance Dennis McShane (Committee Chairman) 8/8 John Lander 8/8 Nicholas Smith 8/8
43 Ophir Energy plc Annual Report 2011 Role and responsibilities of the Nomination Committee During the year, the Nomination Committee reviewed its terms of reference and recommended to the Board minor changes in preparation for the Initial Public Offering in July 2011. The Nomination Committee’s full terms of reference are available on the Company’s website (www.ophir-energy.com) and its main responsibilities include to: –– 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 executives; –– 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 and review annually the time commitment required from the Company’s Non-Executive Directors; –– review the results of the Board performance evaluation process that relate to the composition of the Board; –– review the membership of the Audit and Remuneration Committees and any other Board Committees as appropriate, in consultation with the chairmen of those committees; and –– consider the reappointment of any Non-Executive Director at the conclusion of their specified term of office, giving due regard to their performance and ability to continue to contribute to the Board in the light of the knowledge, skills and experience required. Activities of the Nomination Committee during the year During 2011 the Nomination Committee reviewed the roles and responsibilities of Board members prior to considering candidates for additional appointments. By identifying the skills, knowledge and experience held by the continuing Board members, the Nomination Committee was able to ascertain which additional skills any new Director should possess to bring the greatest benefit to the Company. The Nomination Committee recommended to the Board that Dr Nick Cooper be appointed as Chief Executive Officer of the Company from 1 June 2011. In addition, the Nomination Committee considered, and made recommendations to the Board, regarding the appointment of Ronald Blakely, John Morgan and Patrick Spink as additional Non-Executive Directors of the Company with effect from 7 July 2011. In each case, the Company appointed international executive search agents to assist with the identification of suitable candidates for the Board vacancies. During its deliberations, the Nomination Committee also considered whether the new Non-Executive Directors should be appointed to any Board Committees, and if so which. Subsequently, the Nomination Committee reviewed the membership of all Board Committees, recommending minor changes to allow for a more even distribution of membership between all independent Non-Executive Directors. Diversity and the Davies Report: Women on Boards During the second half of the year the Nomination Committee considered diversity within the Group, particularly at Board and senior management level, and it is supportive of the recommendations of the Davies Report: Women on Boards to increase gender diversity in the Boardroom but not the implementation of quotas. The Company welcomes the current emphasis on diversity in general. All appointments, whether to the Board, the senior management team or elsewhere in the business, are made on the basis of merit, irrespective of any gender, racial or other considerations. The Company is committed to improving diversity at all levels of the business and recognises the valuable contribution a more diverse workforce can make by producing the right mix of skills, experience and knowledge. During its deliberations on Board composition, succession planning and diversity, and as an oil and gas exploration company with an extensive portfolio of interests in Africa, the Nomination Committee agreed that the consideration of positive racial diversity could be merited in any succession planning or appointment process. The Company is also putting in place a clear equal opportunities policy which will embrace gender, racial and all other types of diversity. The Company intends to develop its aspirations regarding racial, gender and other diversity during the coming months, adopting wide diversity targets in its procedures for Board and senior executive appointments. An update on progress will be provided annually. Succession Planning During the latter part of the year, the Nomination Committee began its consideration of the Company’s succession planning methodology for Executive Directors and senior management. This will continue to be a focus for the Nomination Committee during the early part of 2012 with the expectation that development plans will be considered by the Board during the first quarter for implementation from the second quarter onwards. BUSINESS REVIEW GOVERNANCE FINANCIAL STATEMENTS
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