Directors’ <strong>Report</strong> Corporate Governance <strong>Hyder</strong> <strong>Consulting</strong> <strong>PLC</strong> <strong>Annual</strong> <strong>Report</strong> <strong>2012</strong> 35
Chairman’s introduction I am pleased to introduce <strong>Hyder</strong> <strong>Consulting</strong>’s <strong>2012</strong> Corporate Governance <strong>Report</strong>. I would like to affirm at the outset that <strong>Hyder</strong> <strong>Consulting</strong> is committed to maintaining high standards of corporate governance and that its board fully supports the principles of the UK Corporate Governance Code (“Code”) as they apply to the company. The Code can be found on the FRC website (www.frc.org.uk). The report below and the Directors Remuneration <strong>Report</strong> (see pages 64 to 71) provide a detailed commentary on the activities of the board and its committees throughout the year and together explain how we have applied the principles of good governance as detailed in the Code. I can also confirm that the company has complied with the provisions of the Code relevant to smaller listed companies throughout the year. We are conscious of our responsibility to maintain a balance of skills, experience and knowledge on the board and its committees in order to manage the company and execute its strategy successfully. We believe that our small and very experienced board has discharged this responsibility effectively during the past year. Looking ahead, and in view of the proportion of our business in Asia-Pacific, we began a search for a new non-executive director who has substantial experience of the region and who may be based there. An appointment will also refresh the board, increase its diversity, and help enable orderly board and committee succession. The Code does not require the board members of smaller companies to submit to annual re-election; however the board is proposing for the first time to offer all its members for re-election at the forthcoming AGM. Sir Alan Thomas Chairman Directors and the board As at the date of this report the board comprises the chairman, two executive directors and two independent non-executive directors. A list of the individual directors, their biographies and other significant commitments are to be found on pages 32 and 33. As recommended by the Code the roles of the chairman and chief executive are held separately and there is a clear division of responsibilities between each position. The senior independent director (“SID”) is Jeffrey Hume who succeeded Paul Withers in this role on 6 May 2011. It is the board’s current intention that the role is held on a two year rotation. The board’s primary responsibility is to its shareholders for the group’s financial and operational performance whilst 36 <strong>Hyder</strong> <strong>Consulting</strong> <strong>PLC</strong> <strong>Annual</strong> <strong>Report</strong> <strong>2012</strong> fulfilling its obligations to its clients, to its staff and to the communities it serves. Its task is to provide entrepreneurial leadership, to formulate an effective competitive strategy and to execute it successfully. Whilst the board has delegated the normal operational management to the chief executive, the board has a formal schedule of matters that are specifically reserved for its decision. The schedule is reviewed annually and updated as necessary and includes the following matters: setting the group strategy and direction, results and financial reporting, company dividends, corporate governance arrangements, group policies, approval of material contracts, approval of changes to the capital structure of the company, internal controls and risk management systems and approval of acquisitions and divestments. Under the guidance of the chairman, board meetings operate to a standing agenda ensuring that financial, operational, strategic and other matters requiring regular periodic review are given sufficient time for debate and scrutiny. The chairman is responsible for ensuring that adequate time is available for discussion of all agenda items, in particular strategic issues, and there are regularly scheduled reviews of the company’s strategy. The chairman holds meetings from time to time as he considers appropriate with the nonexecutive directors without the executive directors present. Several such meetings were held during the year. On appointment, directors receive an induction tailored to their needs taking into account their previous experience. This includes financial and business information about the group, information about the role of each director and the board as a whole and the matters reserved to it, the terms of reference of and the powers delegated to the board committees. The induction also includes access to senior management and office visits to help the new directors familiarise themselves and gain an understanding and appreciation of the group’s business. The annual schedule of board meetings provides for certain meetings to be held at different group offices, both within the UK and overseas. Two meetings are scheduled jointly with the executive board which greatly assists in the relationship and understanding between the board and the group’s senior executives as well as the board’s knowledge of the group’s international operations. The chairman makes regular visits overseas to meet clients and staff and the board as a whole makes bi-annual visits to group offices, to meet with local senior management and staff and to receive presentations on the local business. These visits greatly assist directors’ ability to keep in touch with the pressures, priorities and opportunities in the group. The company provides the necessary training and resources for developing and updating the directors’ knowledge and capabilities, including briefings from external advisors where necessary. The directors have access to the advice and services of the company secretary and are empowered to take independent professional advice in the furtherance of their duties at the
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