Governance - Xstrata

Attendance at Board meetings and committees of the Board
Director
Board
(5 scheduled)
Chairman and Chief Executive
A clear separation is maintained between the responsibilities of the
Chairman and the Chief Executive. This is documented in a statement
approved by the Board which was reviewed and updated by the
Board at the July 2010 Board meeting to comply with the new UK
Corporate Governance Code.
The Chairman is responsible for leadership of the Board and ensuring
its effectiveness in all aspects of its role by promoting a culture of
openness and debate, and by facilitating the contribution of
non-executive directors. He is also responsible for ensuring that good
communication is maintained with shareholders, that all directors are
made aware of their major shareholders’ issues and concerns, and
that the views of shareholders are communicated to the Board as a
whole. His duties also include ensuring that the directors continually
update their skills and their knowledge of and familiarity with the
Company and the regular review and discussion with each director
of their training and development needs.
The Chief Executive has executive responsibility for the running of
the Company’s business. In particular this includes: the responsibility
to evaluate and recommend strategic policy and direction for Board
consideration; review and recommend for Board consideration and
approval the annual financial statements, annual business plans and
budgets, and interim accounts; maintain effective risk management
and internal control systems including financial, operational and
compliance controls; facilitate the production of detailed proposals
and reviews for Board meetings; and provide the Board with
accurate, timely and clear information.
David Rough is the Deputy Chairman and the Senior Independent
Director. His role and responsibilities as the Senior Independent
Director are detailed in and formalised by Board resolution and, in
summary, are that he should be available to shareholders to discuss
their concerns when the normal channels would not be appropriate
for this purpose, to have contact with analysts and major shareholders
to obtain a balanced understanding of their issues and concerns,
to chair the Nominations Committee, and to lead the Board and
director appraisal process.
Board
(2 ad hoc) Audit (3) Remuneration (2)
www.xstrata.com | 111
Health, Safety,
Environment &
Community (4) Nominations (3)
Mick Davis 5 1 – – 4 –
Con Fauconnier* 4 out of 4 1 – 1 out of 1 3 out of 3 –
Ivan Glasenberg 4 2 – – – 3
Paul Hazen# 1 out of 1 – – 1 out of 1 – –
Peter Hooley 5 – 3 – – –
Claude Lamoureux 5 – 3 – 4 –
Sir Steve Robson 5 1 3 – – 3
David Rough 5 – 3 2 4 3
Trevor Reid 5 1 – – – –
Ian Strachan 5 – 3 – 4 –
Willy Strothotte 5 2 – 2 – –
Santiago Zaldumbide 5 1 – – – –
* Elected on 5 May 2010.
# Retired on 5 May 2010.
Performance evaluation
Board evaluation is undertaken annually, and every three years is
conducted by an external facilitator. For the 2010 evaluation, the
Board engaged Egon Zehnder International to undertake a formal
review of the performance and effectiveness of the Board, its
committees and, individually, all of its directors. The process was
based on structured in-depth interviews during which the following
subjects were explored: composition and skill-sets; relationships
across all the various axes in the team; processes and information
flows; succession planning and other people issues; strategy process,
behaviours at and between Board meetings. The main conclusions
were that the Board continued to operate as an effective body,
providing strong entrepreneurial leadership, and a meaningful and
helpful challenge on strategy. Looking to the future, the importance
of retaining or recruiting directors with the depth of knowledge to
provide meaningful challenge was acknowledged, and with the focus
on the development of organic growth projects in the coming years,
the review recognised that the Board could be strengthened by
recruiting an additional director with direct mining or major projects
experience to complement the experience of Dr. Con Fauconnier
and Ian Strachan. The non-executive directors were seen to provide
appropriate scrutiny of performance against goals.
Appointment of directors
The rules for the replacement and appointment of directors are set
out in the Articles of Association. Directors may only be appointed by
the shareholders of the Company by ordinary resolution and not by
the Board of directors. Under the terms of a Relationship Agreement
to which the Company is a party with Glencore dated 20 March 2002,
Glencore, as a significant shareholder of Xstrata, can nominate up
to three directors or (if lower or higher) such number of directors
equal to one less than the number of directors who are independent
directors, provided that there is at all times a majority of independent
directors on the Board. At present, Glencore has two nominated
directors on the Board, Willy Strothotte, who will be retiring at the
AGM, and Ivan Glasenberg.
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