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• Audit Committee - Terms of Reference
• Remuneration Committee - Terms of Reference
• Nomination Committee - Terms of Reference

Audit Committee - Terms of Reference

Established: 17.2.93 (amended 17.12.03 and 26.2.08)

Members
Tim Score (Chairman)
Sir Andrew Foster
Roger Devlin

In attendance (by invitation only):
Chief Executive as appropriate
Chief Operating Officer as appropriate
Finance Director as appropriate
Other Non Executive Directors as appropriate
External Auditor (at least once a year) as appropriate
Internal Auditor (as required) as appropriate
The Secretary

Meetings
The Committee shall meet at least three times a year. At least once a year the Committee shall meet with the external auditors without any executive board member being present. The external auditors or internal auditors may request a meeting with the Committee.

The quorum for the Committee shall be two.

Authority
The Committee is authorised by the Board to investigate any activity within its terms of reference. It is authorised to seek any information it requires from any employee and all employees are directed to co-operate with any request made by the Committee.

The Committee is authorised by the Board to obtain outside legal or other independent professional advice and to secure the attendance of outsiders with relevant experience and expertise if it considers this necessary.

Duties
External audit

• To make recommendations to the board, for it to put to shareholders for their approval in general meeting, in relation to the appointment, re-appointment and removal of the external auditor and to approve the remuneration and terms of the engagement of the external auditor.
• To review and monitor the external auditor’s independence and objectivity and the effectiveness of the audit process, taking into consideration relevant UK professional and regulatory requirements.
• To develop and implement policy on the engagement of the external auditor to supply non-audit services, taking into account relevant ethical guidance regarding the provision of non- audit services by the external audit firm; and to report to the board, identifying any matters in respect of which it considers that action or improvement is needed and making recommendations as to the steps to be taken.
• To discuss with the external auditor before the audit commences the nature and scope of the audit and to review the auditors’ quality control procedures and steps taken by the auditors to respond to changes in regulatory and other requirements
• To review findings of the audit with the external auditor including a discussion on major issues arising from the half year and final audits, and any matters the auditor may wish to discuss (in the absence of management where necessary).
• To review the external auditor’s management letter and management’s response.

Financial statements
To review the half-year and annual financial statements, and any formal announcements relating to the company’s performance, before submission to the Board, focusing particularly on:

• critical accounting policies and practices and any changes to them
• major judgmental areas
• the extent to which the financial statements are affected by any unusual transactions in the year and how they are disclosed
• the clarity of disclosures
• significant adjustments resulting from the audit
• the going concern assumption
• compliance with accounting standards
• compliance with the UKLA’s Listing Rules and other legal requirements
• reviewing the company’s statement on internal control systems prior to endorsement by the board and to review the policies and process for identifying and assessing business risks and management of those risks by the company

Internal audit

• To review the internal audit programme, ensure co-ordination between the internal and external auditors, and ensure that the internal audit function is adequately resourced and has appropriate standing within the Group
• To approve the appointment or dismissal of the head of internal audit or, if applicable, external firm providing internal audit services
• To consider the major findings of the internal audit investigations and management’s response.

Other matters

• To review the effectiveness of the Company’s internal control, financial reporting, corporate governance and risk management systems
• To review and approve the statements to be included in the annual report concerning internal controls and risk management
• To review procedures for detecting fraud
• To review the company’s procedures for handling allegations from whistleblowers and ensure that arrangements are in place for the proportionate and independent investigation of such matters and for appropriate follow up action
• To consider other topics, as defined by the Board.

Reporting procedures
The Secretary shall circulate minutes of the meetings to all members of the Committee and all other Directors.

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Remuneration Committee - Terms of Reference

Established: 17.2.93 (amended 10.03.03, 14.12.05 and 26.2.08)

Members
Barry Gibson (Chairman)
Roger Devlin
Tim Score

In attendance:
The Secretary
Remuneration consultants (as appropriate)

Meetings:
The Committee shall meet at least twice a year.
The Chief Executive and the Chairman may as appropriate be invited to attend and speak at meetings of the Committee. However, no Director shall attend any discussion or participate in any decision concerning their own remuneration.
The quorum for the Committee shall be two.

Authority
The Committee is authorised by the Board to seek any information it requires from any employee of the Company in order to perform its duties.
The Committee is authorised by the Board, when the fulfilment of its duties requires, to obtain legal or other professional advice including the advice of independent remuneration consultants, to secure the attendance of external advisors at its meetings, if it considers this necessary, and to obtain reliable, up-to-date information about remuneration in other companies, at the Company’s expense.

Consultants:
New Bridge Street Consultants LLP – advise on all aspects of senior executive remuneration. They have no other connection with the Company.

Duties

• Determine and agree with the Board the framework for the remuneration of the Chief Executive, Executive Directors, the Chairman, the Company Secretary and other members of the senior management team as it is designated to consider.
• Adopt as the objective of such policy the recommendation of the Combined Code on Directors’ Remuneration. That is -"to provide a level of remuneration to attract and retain the directors needed to run the company successfully, but avoid paying more than is necessary for this purpose and to structure a proportion of the remuneration to link rewards to corporate and individual performance".
• The remuneration of the Non-executive Directors is a matter for the Board alone.
• Within the terms of the agreed policy, determine the fees for the Chairman
• Determine the remuneration and conditions of employment of the Chief Executive and Executive Directors including bonus payments, pension arrangements and share incentive awards.
• Approve the remuneration and conditions of employment of the Company Secretary and other members of the senior management team as it is designated to consider.
• Note the remuneration and conditions of employment of other senior management and note remuneration trends across the Group.
• In determining such packages and arrangements, give due regard to the comments and recommendations of the Combined Code, the UK Listing Authority’s Listing Rules and best practice of interested investor groups.
• Ensure that contractual terms on termination, and any payments made, are fair to the individual and the company, that failure is not rewarded and that the duty to mitigate loss is fully recognised.
• Be aware of and advise on any major changes in employee benefit structures throughout the company or group.
• Agree the policy for authorising claims for expenses from the Chief Executive and Chairman.
• Ensure that provisions regarding disclosure of remuneration, including pensions, as set out in the Directors’ Remuneration Report Regulations 2002 and the Combined Code, are fulfilled.
• Review and approve the Directors’ Remuneration Report in the annual report and accounts.
• Be exclusively responsible for establishing the selection criteria, selecting, appointing and setting the terms of reference for any remuneration consultants who advise the committee.
• Make the committee’s terms of reference publicly available. These should set out the committee’s delegated responsibilities and be reviewed and, where necessary, updated annually.
• Review and approve the design of all share incentive plans for approval (where appropriate) by shareholders. For any such plans determine individual awards to be made and performance targets to be used.
• To approve the grant of awards or options under any of the Company’s share incentive plans.
• Determine targets for any performance-related pay schemes operated by the company.
• To consider and decide upon such other matters as the Board may refer to it.

Reporting procedures:
The Secretary shall circulate the minutes of the meetings to all members of the Committee and all other Directors

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Nomination Committee - Terms of Reference

Established: 10.03.03 (amended 26.2.08)

Members
David Ross (Chairman)
Barry Gibson
Sir Andrew Fostere
Jorge Cosmen

In attendance:
The Secretary

Meetings:
The Chief Executive may as appropriate be invited to attend and speak at meetings of the Committee. However, no Director shall attend any discussion concerning their own appointment to any position.
The quorum for the Committee shall be two

Authority:
The Committee is authorised by the Board to seek any information it requires from any employee of the Company in order to perform its duties.
The Committee is authorised by the Board, when the fulfilment of its duties requires, to obtain legal or other professional advice including the advice of independent recruitment consultants, to secure the attendance of external advisors at its meetings, if it considers this necessary at the Company’s expense.

Duties:

• To regularly review the structure, size and composition of the board (including skills, knowledge and experience) and make recommendations to the board with regard to any changes.
• To identify and nominate for the approval of the board, candidates to fill board vacancies as and when they arise.
• Before making an appointment, to evaluate the balance of skills, knowledge and experience on the board and, in the light of this evaluation, prepare a description of the role and capabilities required for a particular appointment.
• To review annually the time required from a non-executive director. Performance evaluation will be used to assess whether the non-executive director is spending enough time to fulfil their duties.
• To consider candidates from a wide range of backgrounds and look beyond the “usual suspects”.
• To give full consideration to succession planning in the course of its work, taking into account the challenges and opportunities facing the company and what skills and expertise are needed on the board in the future.
• To 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 and make recommendations to the board.
• To make a statement in the annual report about its activities; the process used for appointments and explain if external advice or open advertising has not been used; the membership of the committee, number of committee meetings and attendance of members over the course of the year.
• To make publicly available its terms of reference explaining clearly its role and the authority delegated to it by the board.
• To ensure that on appointment to the board, non-executive directors receive a formal letter of appointment setting out clearly what is expected of them in terms of time commitment, committee service and involvement outside board meetings.
• To make recommendations to the board concerning any matters relating to the continuation in office of any director at any time.
• To consider and decide upon such other matters as the Board may refer to it.

Reporting procedures
The Secretary shall circulate the minutes of the meetings to all members of the Committee and all other Directors.

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