Nomination and Governance Committee Report
The Nomination and Governance Committee comprises Michael Buckley (Chairman) and three independent non-executive Directors, Róisín Brennan, David Byrne and Leslie Van de Walle. Further biographical details regarding the members of the Nomination and Governance Committee are set out on this page.
As Chairman of DCC’s Nomination and Governance Committee, I am pleased to present the report of the Committee for the year ended 31 March 2014 which has been prepared by the Committee and approved by the Board.
The Nomination and Governance Committee is responsible for keeping Board renewal, structure, size and composition under constant review, including the skills, knowledge and experience required, taking account of the Group’s businesses, strategic direction and diversity objectives. The Committee also actively manages a transparent process for appointment of new Directors. The Committee uses the services of executive search firms to assist with the search for suitable candidates.
The Nomination and Governance Committee has overseen the development of an excellent balance of background and experience on our Board as vacancies have arisen in recent years. Notable in this context is the fact that, following the appointment of Dr. Pamela Kirby on 3 September 2013 as a new non-executive Director, women now represent 27% of the Board. Gender balance makes good business sense. The Committee will work assiduously with management in the coming years to increase diversity in our senior management cadre.
The Committee is also responsible for reviewing corporate governance developments and in particular has reviewed the changes to the UK Corporate Governance Code issued in September 2012 (‘the Code’), which applied to DCC’s financial year ended 31 March 2014.
The responsibilities of the Committee are summarised in the table below and are set out in full in its Terms of Reference, which are available on the DCC website www.dcc.ie under Investor Relations/Corporate Governance.
On behalf of the Nomination and Governance Committee
Chairman, Nomination and Governance Committee
20 May 2014
Role and Responsibilities
Board Composition and Renewal
- Regularly review the structure, size and composition (including the skills, knowledge and experience) required of the Board compared to its current position and make recommendations to the Board with regard to any changes.
- Before making a nomination, to evaluate the balance of skills, knowledge, independence and experience on the Board, and,
in the light of this evaluation, to prepare a description of the role and capabilities required for a particular appointment.
- Keep under review the leadership needs of the organisation, both executive and non-executive, with a view to ensuring the continued ability of the organisation to compete effectively in the marketplace.
- Succession planning for Directors, in particular the Chairman and the Chief Executive, and senior Group management.
- Keep under review the Board Diversity Policy and the setting of measurable objectives for implementing the Policy.
- Monitor the Company’s compliance with corporate governance best practice and with applicable legal, regulatory and listing requirements (including but not limited to the Companies Acts, the UK Listing Authority’s Listing Rules and the UK Corporate Governance Code) and to recommend to the Board such changes or additional action as the Committee deems necessary.
- Advise the Board of significant developments in the law and practice of corporate governance.
- Oversee the conduct of the annual evaluation of Board, Committee and individual Director performance.
The length of tenure of the Directors on the Board and on the Committees of the Board is set out below. The length of tenure of members of Board Committees is dealt with in the individual Committee reports.
Board Composition and Renewal+-
At each of its meetings during the year, the Nomination and Governance Committee considered the composition of the Board to ensure the Board has the appropriate combination of skills, knowledge and experience.
The Nomination and Governance Committee identified a need for a non-executive director with deep experience of the healthcare sector internationally, at senior management and Board level, as well as a track record of business development internationally. Subject to satisfaction of the professional competencies and experience requirements, a preference was expressed for a female candidate.
An international professional search firm, JCA (who do not have any other connection with the Company) was employed to carry out a wide ranging, international search. The search firm produced a long list of possible candidates, which was reviewed by the Chairman, who interviewed a number of candidates. A short list was then drawn up, reviewed with and approved by the Committee. Those on the short list were interviewed by the Chairman at least once and in some cases by the Deputy Chairman. When a preferred candidate emerged, she was interviewed individually by the executive Directors and most of the non-executive Directors, before a formal proposal was made to the Board.
Board diversity was a regular agenda item at Committee meetings during the year. In the previous financial year, the Committee developed a Board Diversity Policy which was approved by the Board. This Policy is available on the Company’s website www.dcc.ie.
In addition, upon the recommendation of the Committee, the Board has approved a Group Diversity and Equal Opportunities Policy Statement, developed by Group Human Resources, which was implemented in Group subsidiaries in conjunction with local legislative requirements.
Taking account of the Davies Report, the gender disclosure requirements of the UK Companies Act 2006 (Strategic Report and Directors Report) Regulations 2013, the Code and the Board Diversity Policy, the Nomination and Governance Committee remained focussed on increasing the number of female non-executive Directors and those with experience in the sectors in which we operate. Dr. Pamela Kirby’s appointment to the Board in September 2013 brought the proportion of female directors to 27%. The target date set for FTSE 350 companies to reach a proportion of 25% is 2015, while DCC is one of only 17 FTSE 250 companies already to have three or more female directors on its Board.
The composition of the Board as at 31 March 2014 can be analysed as follows:
The Committee has particular regard to the leadership needs of the organisation and gives full consideration to succession planning for Directors and senior management, in particular the Chairman and Chief Executive, taking into account Group strategy, as well as the challenges and opportunities facing the Group and the skills and expertise required. A detailed succession management plan, prepared by the Chief Executive, was considered at a meeting during the year and was presented to the Board for approval.
The Committee advises the Board on significant developments in the law and practice of corporate governance and monitors the Company’s compliance with corporate governance best practice, with particular reference to the Code. The Committee has recommended any necessary action required to be adopted and implemented by the Board in respect of the Code.
The Nomination and Governance Committee reviewed and approved the Governance Statement in the Annual Report and other material being made public in respect of the Company’s corporate governance.
The terms and conditions of appointment of non-executive Directors are set out in their letters of appointment, and include expected time commitment in respect of Board and Committee meetings, boardroom development training and visits to Group subsidiaries. The letters of appointment are available for inspection at the Company’s registered office during normal office hours and at the Annual General Meeting of the Company.
The Nomination and Governance Committee comprises Michael Buckley (Chairman) and three independent non-executive Directors, Róisín Brennan, David Byrne and Leslie Van De Walle. Each member’s length of tenure at 31 March 2014 is set out in the table above. Further biographical details regarding the members of the Nomination and Governance Committee are set out on this page.
The Nomination and Governance Committee met five times during the year ended 31 March 2014 and there was full attendance by all members of the Committee.
The Chief Executive, other executives and external advisers are invited to attend all or part of any meeting. The Company Secretary is the secretary to the Nomination and Governance Committee.
The Chairman of the Board does not chair the Committee when it is dealing with the matter of succession to the chairmanship.
Annual Evaluation of Performance
As detailed on this page, the Board conducts an annual evaluation of its own performance and that of it’s Committees, Committee Chairman and individual Directors. This process concluded that the performance of the Nomination and Governance Committee and of the Chairman of the Nomination and Governance Committee were satisfactory.
The Chairman of the Nomination and Governance Committee reports to the Board at each meeting on the activities of the Committee.
The Chairman of the Nomination and Governance Committee attends the Annual General Meeting to answer questions on the report on the Committees’ activities and matters within the scope of the Committee’s responsibilities.