Rexam annual report 2010 - Governance

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54 Rexam annual report 2010 directors’ report corporate governance good governance The Rexam board believes there is a link between high standards of governance and the creation of shareholder value, and is committed to promoting governance which is meaningful and relevant. Sir Peter Ellwood chairman compliance This corporate governance report has been prepared in accordance with the Combined Code on Corporate Governance issued in 2008 (the Code) by the Financial Reporting Council (FRC). The Code can be viewed on www.frc.co.uk. The board has also considered, in advance of the commencement date, the principles and provisions of the new UK Corporate Governance Code (the New Code) published by the FRC in May 2010. This report, being part of the directors’ report which includes the business review and the remuneration report, provides a summary of the Group’s procedures for applying the principles of the Code and the extent to which such principles have been applied. Throughout the period 1 January to 31 December 2010 the Company has been fully compliant with the Code. The board believes it has put policies in place so that the Company is fully compliant with the New Code from 1 January 2011. leadership the role of the board The board’s primary role is to ensure the sustainable long term success of the Group, which it does through its focused leadership, and the development, review and implementation of the Group’s strategy. Its other roles are to maintain control over the Group’s assets, to monitor performance of management and succession planning, to establish high ethical standards of behaviour, to develop robust corporate governance and risk management practices and procedures, and ensure that its obligations to its shareholders are understood and met. The board also ensures that the strategy is in the best interests of the Group’s customers, suppliers, employees and the local communities in which Rexam operates. Matters referred to the board are considered by the board as a whole and no one individual has unrestricted powers of decision. There are well documented procedures and controls, including a formal schedule of matters that require the board’s specific approval. This schedule provides the framework for the matters to be decided by the board and those which can be delegated to committees of the board or senior management. schedule of matters reserved for the board Board appointments and removals Changes to the Group’s management and control structure The Group’s strategy, including the acquisition and disposal of businesses Matters relating to the Company’s share listing Material financial decisions relating to equity, marketable securities, borrowing facilities, guarantees or indemnities and changes in accounting policy or practice All capital expenditure projects over £10m or any capital expenditure project which, regardless of the amount, does not meet the Group’s financial criteria The appointment and removal of principal advisors and external auditors
oard membership and meetings 2010 held attended 9 Sir Peter Ellwood (chairman of the board) 9 Graham Chipchase 9 Noreen Doyle 9 John Langston 9 Wolfgang Meusburger 9 David Robbie 9 Jean-Pierre Rodier 9 Carl Symon 8 The Company operates through its main board committees namely the audit and risk (formerly the audit) committee and the nomination and remuneration committees. The board also has a finance committee which oversees the financial risk management strategy, policy and treasury transactional matters delegated to it, and reviews and approves financial transactions on behalf of the board. The board evaluates the membership of its individual board committees on an annual basis and aims to ensure that its principal committees have different non executive directors as their chairman. The board committees are governed by terms of reference which detail the matters delegated to the committee and for which they have authority to make decisions. The terms of reference for the main committees can be found on the Rexam website. Appropriate insurance cover has been obtained to protect the directors and senior management in the event of a claim being brought against them in their capacity as directors or officers of the Company and its subsidiaries. chairman and chief executive The roles of the chairman and chief executive are separate with each having clearly defined responsibilities. Nonetheless, they retain a close working relationship to ensure the integrity of the board’s decision making process and the successful delivery of the Group’s strategy. Sir Peter Ellwood, as chairman of the Company, is responsible for the leadership of the board and ensuring its effectiveness. He works with the company secretary to ensure that appropriate matters are discussed during board meetings. He safeguards the interest of the Company’s shareholders and is also responsible for the overall supervision of the Group’s policies governing the conduct of the business. Graham Chipchase, as chief executive, is responsible for the executive management of the Company and the running of the Group’s businesses. The written job specifications for the roles of chairman and chief executive are reviewed annually by the nomination committee. non executive directors Rexam has six non executive directors, including the chairman, whose role is to understand the business and its markets, consider proposals on strategy and constructively challenge the management. They contribute wide experience and objective perspective and through the board committees bring focus on governance and succession planning, internal controls, risk management policies and remuneration. Non executive directors serve the Company under letters of appointment which are generally for an initial three year term. On appointment, an undertaking is requested confirming that the non executive director has sufficient time to fulfil his or her role on the board. Carl Symon is the senior independent director and, when necessary, supports the chairman and the other non executive directors on Company related matters. He is available to talk to shareholders if they have any issues or concerns or if there are any unresolved matters that shareholders believe should be brought to his attention. There is a written job specification for this role and it is reviewed annually by the nomination committee. The non executive directors, including the senior independent director, met several times during the year with the chairman but without the executive directors in attendance to discuss, on a less formal basis, the Group’s performance, governance, strategy and succession planning. board balance as at 23 February 2011 ● 6 non executive directors including the chairman ● 2 executive directors 55 overview financial statements governance sustainability business review
Page 1 and 2: directors’ report governance We i
Page 3: executive directors company secreta
Page 7 and 8: The chairman regularly reviews and
Page 9 and 10: the audit and risk committee The co
Page 11 and 12: internal audit The internal audit f
Page 13 and 14: Communication with private sharehol
Page 15 and 16: Rewards must be aligned with the Co
Page 17 and 18: The weighting of the performance ta
Page 19 and 20: share performance The adjacent grap
Page 21 and 22: directors’ remuneration (audited
Page 23 and 24: Long Term Incentive Plan 2007 (2007
Page 25 and 26: other disclosures The annual report
Page 27: The service contracts of the execut

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