2009 Annual Report - CRH

# assists management, at their request, in considering any financial (including
taxation) aspect of the Group’s affairs.
The Nomination Committee assists the Board in ensuring that the composition of
the Board and its Committee is appropriate to the needs of the Group by:
# assessing the skills, knowledge, experience and diversity required on the
Board and the extent to which each are represented;
# establishing processes for the identification of suitable candidates for
appointment to the Board; and
# overseeing succession planning for the Board and senior management.
To facilitate the search for suitable candidates to serve as non-executive Directors,
the Committee uses the services of independent consultants.
During 2009, the Committee identified, and recommended to the Board, a suitable
candidate for appointment as a non-executive Director.
The Terms of Reference of the Nomination Committee, which were updated in
December 2009 in relation to membership of the Committee, are reviewed annually.
The Remuneration Committee, which consists solely of non-executive Directors
considered by the Board to be independent:
# determines the Group’s policy on executive remuneration;
# determines the remuneration of the executive Directors;
# monitors the level and structure of remuneration for senior management; and
# reviews and approves the design of all share incentive plans.
The Committee receives advice from leading independent firms of compensation
and benefit consultants when necessary and the Chief Executive is fully consulted
about remuneration proposals. The Committee oversees the preparation of the
Report on Directors’ Remuneration.
In 2009, the Committee determined the salaries of the executive Directors and
awards under the performance-related incentive plans; approved the terms of a
long-term incentive plan (2009-2013) for the Chief Executive; set the remuneration
of the Chairman; and reviewed the remuneration of senior management. It also
approved the award of share options to the executive Directors and key
management and the conditional allocation of shares under the Performance
Share Plan. In addition, the Committee approved the partial release of awards
made under the Performance Share Plan in 2006. Details of the factors taken into
account when assessing the level of vesting under the Performance Share Plan
are set out in the Report on Directors’ Remuneration on page 51.
Also in 2009, the Committee, with the assistance of external advisers, undertook
a review of the Company’s compensation arrangements for executive Directors
and senior managers. Further commentary on this review is contained in the
Report on Directors’ Remuneration on page 52.
The Terms of Reference of the Remuneration Committee, which were updated in
February 2010 in relation to membership of the Committee, are reviewed annually.
Corporate Social Responsibility
Corporate Social Responsibility is embedded in all CRH operations and activities.
Excellence in environmental, health, safety and social performance is a daily key
priority of line management. Group policies and implementation systems are
summarised on page 10 and are described in detail in the CSR Report on the
Group’s website, www.crh.com. During 2009, CRH was again recognised by
several key rating agencies as being among the leaders in its sector in respect of
sustainability performance.
Code of Business Conduct
The CRH Code of Business Conduct is applicable to all Group employees. The
Code is available on the Group’s website, www.crh.com. Regional hotline facilities
are in place, to enable employees to report suspected breaches of the Code.
Substantial Holdings
As at 1st March 2010, the Company had received notification of the following
interests in its Ordinary share capital:
Name Holding/Voting Rights %
Capital Research and Management
Company (CRMC)* 84,225,434 12.06%
UBS AG 26,380,604 3.77%
BlackRock, Inc. 24,701,820 3.53%
* On 7th January 2010, The Growth Fund of America, Inc. (GFA) advised the
Company that, with effect from 1st January 2010, it no longer exercised voting
rights in respect of its holding of 30,131,457 shares (4.31%). CRMC has separately
advised that, with effect from 1st January 2010, it has been granted proxy voting
authority by various Capital Group funds, including GFA, that previously voted
independently from CRMC.
On 3rd February 2010, Capital Group International, Inc., which notifies its holding
independently of CRMC, notified the Company that its interest in the Company
had fallen below 3%.
On 22nd July 2009, Irish Life Investment Managers notified the Company that its
interest in the Company had fallen below 3%.
On 30th April 2009, Bank of Ireland Asset Management Limited notified the
Company that its interest in the Company had fallen below 3%.
On 14th April 2009, FMR LLC (Fidelity North America)(FMR) and FIL Limited
Fidelity (Fidelity Asia Pacific, Europe and the Middle East)(FIL), which previously
advised their shareholding in a joint notification, informed the Company that their
holdings had been disaggregated and would be notified separately in future. FMR
notified that its holding on 14th April 2009 was 16,081,428 shares (2.30%), while
FIL notified that its holding was 15,405,831 shares (2.20%).
BlackRock, Inc. has advised that its interests in CRH shares arise by reason
of discretionary investment management arrangements entered into by it or its
subsidiaries.
Memorandum and Articles of Association
The Company’s Memorandum of Association sets out the objects and powers of
the Company. The Articles of Association detail the rights attaching to each share
class; the method by which the Company’s shares can be purchased or reissued;
the provisions which apply to the holding of and voting at general
meetings; and the rules relating to the Directors, including their appointment,
retirement, re-election, duties and powers. Further details in relation to the
purchase of the Company’s own shares are included on page 49 of the Directors’
Report.
A copy of the Memorandum and Articles of Association can be obtained from the
Group’s website, www.crh.com.
Communications with Shareholders
Communications with shareholders are given high priority and there is regular
dialogue with institutional shareholders, as well as presentations at the time of the
release of the annual and interim results. Conference calls are held following the
issuance of trading statements, interim management statements and major
announcements by the Group, which afford Directors the opportunity to hear
investors’ reactions to the announcements and their views on other issues.
Trading statements are usually issued in January and July and interim management
statements are issued in May and November. Major acquisitions are notified to
the Stock Exchanges in accordance with the requirements of the Listing Rules. In
addition, development updates, giving details of other acquisitions completed
and major capital expenditure projects, are usually issued in January and July
each year.
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