Annual Report and Accounts 2006 - DCC plc

11Board renewalThe Nomination Committee keepsBoard renewal, structure, size andcomposition under regular review,including the skills, knowledge andexperience required. The Committeehas particular regard to the leadershipneeds of the organisation, bothexecutive and non-executive, andtherefore gives full consideration tosuccession planning for the Chairmanand Chief Executive. In this regard,I have informed the Committee thatthis is the last year I will seekre-election to the Board, as I intendto retire as Chairman and from theBoard in advance of the AnnualGeneral Meeting in 2007.On the recommendation of theNomination Committee, the Boardco-opted four new non-executiveDirectors in recent years - MauriceKeane in 2002, Bernard Somers in2003 and Róisín Brennan and MichaelBuckley in September 2005. Róisín isan executive director and ChiefExecutive designate of IBI CorporateFinance, where she has hadextensive experience advising publiccompanies principally in relation tostrategy and mergers & acquisitions.Róisín is a member of the AuditCommittee and the RemunerationCommittee. Michael was formerlyGroup Chief Executive of Allied IrishBanks plc. Michael is a member ofthe Nomination Committee and theRemuneration Committee and hasbeen appointed Senior IndependentDirector.As previously announced, Mr KevinMurray, executive Director, isresigning from the Board and fromhis position as Managing Director ofDCC Healthcare on 30 June 2006.Kevin has been with DCC for18 years and has made a greatcontribution to the Group. Kevin willleave DCC with the friendship andgood wishes of the Board and hiscolleagues across the Group.Fyffes’ failed legal actionand subsequent appealOn 21 December 2005, the Irish HighCourt found in favour of DCC andOthers in the case taken againstthem by Fyffes plc, under Part V ofthe Irish Companies Act 1990, inrelation to the sale of shares byLotus Green in February 2000. Indismissing Fyffes’ claim against all ofthe defendants, the Court held thatthe share sales were entirely lawfuland that none of the defendants hadany liability arising from the sales ofthe shares in Fyffes in February 2000.On 10 February 2006, the Irish HighCourt decided that Fyffes should paymost of DCC’s costs in relation to itsfailed legal action against the Group.DCC expects to recoup approximately€8.5 million from Fyffes followingthis High Court order and, accordingly,has accrued this amount as a creditunder exceptional operating costs.On 7 April 2006, Fyffes announcedits intention to lodge an appeal tothe Irish Supreme Court seeking tooverturn the decision of the IrishHigh Court in relation to Fyffes’ failedlegal action against DCC plc andOthers. This appeal will be challengedvigorously and comprehensively andDCC is confident that there are nogood grounds of appeal and that thedetailed and considered decision ofthe High Court will be upheld.Corporate governanceThe Board of DCC is committed tomaintaining the highest standards ofcorporate governance. The Board issatisfied that the Group has effectiveongoing processes for identifying,evaluating and managing risks facedby the Group. A detailed statement,set out on pages 38 to 41, describeshow DCC has complied with all ofthe Principles of Good Governanceand Code of Best Practice as setout in the Combined Code onCorporate Governance.The futureDCC’s balanced business model, itsexperienced management and itsfinancial strength leave the Groupwell placed to generate ongoingorganic and acquisition growth.Alex SpainChairman26 May 2006