BP Annual Report and Form 20-F 2011 - Company Reporting

Corporate governance• Oversee GCRO’s plans for expenditures and investments on majorprojects or matters beyond those included within the established claimsadministration processes.• Oversee management strategy and actions to restore the group’sreputation in the US.Remuneration committee reportThe report of the remuneration committee is contained in the Directors’remuneration report on pages 139 to 151.Committee processesInformation and adviceThe committee receives its information from the leadership of the GCROand external advisers. Privileged legal briefings are regularly provided bythe group general counsel and chief counsel for the GCRO, who are joinedon occasion in committee meetings by other internal and external legalcounsel.BP’s internal audit function has conducted reviews of variousGCRO activities and processes, and these have been summarized forthe committee’s review. Primary monitoring of financial risk associatedwith GCRO’s activities is undertaken by the audit committee. Safety risksrelated to GCRO’s activities are monitored by the SEEAC.Training and visitsThe high frequency of meetings in 2011 has facilitated the committee’sunderstanding of the important issues and numerous interdependencies.Three of these meetings were held in the US and were of extendedduration, providing the opportunity for the committee to interact withmembers of the GCRO leadership team.Committee activitiesThe committee’s activities have included the following:• Legal: legal updates from the chief counsel to the GCRO have formeda significant part of the committee’s agenda, given the breadth andpace of activities. The committee has overseen the GCRO’s integratedlegal approach, which incorporates all government, civil and criminalinvestigations, the Multi-District Litigation, the Natural Resource DamageAssessment process, and legal aspects of the claims processes. Thecommittee has overseen the company’s preparation for trial, as well asthe settlements entered into with the other working interest ownersin the Macondo well and with some sub-contractors working on thedevelopment. The committee has continued to monitor engagementwith other responsible parties and contractors.• Claims: the committee has monitored the status of claims fromindividuals and businesses administered by the independent Gulf CoastClaims Facility; and the status of claims from government entities, whichcontinue to be administered by BP. Assessments of potential futureclaims for provisioning purposes are reviewed by the audit committee.• Remediation: the committee has received regular updates on theprogress of clean-up and remediation activities. The committee alsomonitored discussions with Natural Resource Trustees, with whomagreement was reached on early restoration projects.• GCRO controls: the committee oversaw the continued developmentof financial controls underpinning the breadth of the GCRO’s complextasks. The audit committee remains the primary forum for the oversightof these controls and associated audits.Corporate governanceBP Annual Report and Form 20-F 2011 131