Modernising Trust Ports 2nd Edition.pdf - SailingNetworks

3. THE BOARD.8 Performance Management and Board Remuneration.8.1 The performance and contribution of the individual board members should bemonitored on a regular basis by the chairman, deputy chairman and chiefexecutive. As with the general performance of the port, the performancemanagement of board members should constitute a cycle of assessment andappraisal, followed by new target setting, and the subsequent reporting ofprogress. Board members should expect an annual appraisal of theirperformance by the chairman..8.2 The performance of individual board members can obviously be appraised inpart through looking at the general performance of the port, and the resultantbenefits to stakeholders. The annual appraisal should also seek to evaluatethe board member's individual contribution to the life of the port and theworking of the board, as well as factors such as attendance. This evaluationshould take place against objectives agreed with the board member at thebeginning of the year..8.3 The board should appraise the performance of the chief executive, thechairman and deputy chairman on a similar basis. As a general rule the boardshould be responsible for appointment of the chairman and deputy chairmanfrom amongst its members with regard to previous performance..8.4 The administration of remuneration policy should be the preserve of aremuneration committee of the board, which should comprise two or threemembers and should make available its terms of reference. It should havedelegated responsibility to set the remuneration levels of board members andthe chairman. The remuneration committee should also recommend andmonitor the remuneration of the senior executives..8.5 Again in line with the provisions of the Combined Code, the remunerationcommittee should, as part of its duties, consider the compensationcommitments that would be entailed in the event of early termination ofappointments, and where remuneration consultants are appointed, astatement should be made detailing any links that they may have with the port..8.6 At any stage through the year, but particularly during formal appraisal process,if an assessment is made that a board member is not felt to have made aneffective contribution to the trust port, through both regular attendance andinput to the work of the trust port, he or she should receive a formal writtenwarning setting out the chairman's views. Specific further targets to achieveshould be set on the understanding that a lack of improvement within anagreed time scale will result in termination of his or her appointment, eitherthrough resignation or a vote of no confidence from the board. The chairman,deputy chairman and chief executive should be prepared to work with thesemembers to offer encouragement and support.38