The Role of the Board
The Board provides leadership of the Group and direction for management. It is collectively responsible and accountable to the Company’s shareholders for the long-term success of the Group and for ensuring the appropriate management and operation of the Group in pursuit of its objectives. The Board is responsible for setting the Group’s strategy, values and standards and ensuring that the necessary controls and resources are in place to deliver these.
To help discharge its responsibilities, the Board has a formal schedule of matters specifically reserved for its decision, which form the core of the Board's agenda. The Board has also delegated certain aspects of its responsibilities to the following Committees: the Audit Committee, the Remuneration Committee, the Nominations Committee, the Safety & Environment Committee and the Disclosure Committee.
The Board and its Committees have regular scheduled meetings and hold additional meetings as and when required. Directors are expected, where possible, to attend all Board meetings, relevant Committee meetings, the AGM and any General meetings. The core activities of the Board and its Committees are documented and planned on an annual basis and a list of matters arising from each meeting is maintained and followed up at subsequent meetings. The Non-Executive Directors also meet during the year without the Executive Directors being present.
All new Directors receive a structured and comprehensive induction programme. It is prepared and arranged by the Chairman and Company Secretary, with executive input as necessary, tailored to the experience and background of the individual and the requirements of the role.
Such an induction programme was formulated for Chris Davies who took up his first executive appointment in joining the Board on 10 May and becoming Group Finance Director on 1 June 2017. He replaced Matt Ashley who relinquished that position (but not his executive directorship) to take up a new role with the Group as President and CEO, North America, on 1 September. Mr Ashley and the Company Secretary led the induction programme which also provided for a smooth handover of responsibilities and included:
- the issue of a Board induction pack to assist with understanding the Group’s history, culture, business, markets, strategy, risk management framework (including the risk environment), internal controls and financial position
- hands on briefing meetings coupled with introductory meetings with direct reports, members of the Group Executive Committee, the Chairman and the Audit Committee Chair (and subsequently with all Directors)
- meetings with the Company’s external auditors, brokers and lead bankers (and subsequently with other key advisers and stakeholders)
- specific information and training sessions with the Company Secretary, the Company’s corporate lawyers and the Director of Safety regarding Directors’ duties, responsibilities and liabilities, Board mechanics, corporate governance practices and key policies and procedures (including the Group’s Health & Safety policy, plan and standards)
- a number of site visits in the UK, Spain and the US, including with the Board in June to Madrid and in September to Washington DC.
Mr Ashley also benefited from a structured business and customer focused induction programme provided to him in Chicago by his predecessor, local management and the US General Counsel.
Both of the above induction programmes, and their progress to completion, were overseen by the Chairman and reported on to the Board through the Company Secretary.
Development and training
As part of an ongoing programme of development and training, which is the responsibility of the Chairman:
- the Board held various specific briefing sessions during the year on matters such as Brexit, technology, digital marketing and other economic and political risk factors that may affect the business or the wider transport sector in our main operating territories
- Directors receive relevant information, as part of and between meetings, regarding the Group’s business, financial performance, shareholder sentiment and the legal, regulatory and governance environment in which it operates
- all Directors are encouraged to attend training, discussion and briefing forums on relevant topical matters. For the Non-Executive Directors, this is available through the Deloitte Academy which facilitates such events, with online and remote follow up access available.
Additionally, to provide Directors with further opportunities to meet with senior and local management and increase their visibility and working knowledge of the Group’s operations and market dynamics, the Board aims to visit two of the Group’s locations each year. To that end, the Board meetings in June and September 2017 were held in Madrid and Washington DC respectively, the latter also facilitating the Board’s annual strategy review meeting. Details of the Washington trip can be found on the page opposite.
The Chairman also undertakes a busy programme of local site and management visits, which this year included a number of UK sites and a trip to our operations in Bahrain. To a lesser extent, but also encouraged, other Non-Executive Directors undertake similar personal visits from time to time.
Executive Directors are permitted to accept one external non-executive directorship with a non-competing company provided they first obtain Board approval. No such external appointments are currently held by any of the Executive Directors.
Information and support
To enable the Directors to fulfil their duties and responsibilities effectively, they are provided with and given access to all necessary resources and expertise. This includes access to the Company Secretary (who acts as Secretary to the Board and its Committees) and management and, through an established procedure, the ability to obtain, at the Company’s expense, independent professional advice.
To facilitate effective review and decision-making, Directors receive in advance of meetings high-quality papers, including from senior executive, management and advisers, who are also regularly invited to attend meetings for discussion of specific items in greater depth. The papers are published via a secure web portal which also hosts a library of other relevant Company information, including previous meeting papers, minutes and Board procedures.
If a Director is unable to attend a meeting because of exceptional circumstances, they still receive the papers and other relevant information in advance of the meeting and have the opportunity to discuss with the relevant Chair or the Company Secretary any matters on the agenda they wish to raise or to follow up on the decisions taken at the meeting.
In addition to Board meetings and private sessions held between the Chairman and the Non-Executive Directors, there are other opportunities arranged during the year allowing for informal discussions between Directors on relevant items.
Re-election of Directors
In accordance with the Company’s Articles of Association, and the Code, all Directors of the Company will offer themselves for either election or re-election at each AGM. Non-Executive Directors are appointed for specific terms, subject to re-election. Non-Executive Directors will only be put forward for re-election if, following performance evaluation, the Board believes the Director’s performance continues to be effective and demonstrates commitment to the role.
The Directors’ Remuneration Report, including details of remuneration policy and service contracts, is set out within the Annual Report here.
Directors' conflicts of interest
The Board operates a policy to identify and manage declared actual and potential conflicts of interest which Directors (or their connected persons) may have and are obliged to avoid under their statutory duties and the Company’s Articles of Association. The Board considers each Director’s situation and decides whether to approve any conflicts based on the overriding principle that a Director must at all times only be able to consider and exercise judgement to promote the success of the Company. The policy has been in place and operated effectively throughout the year. Authorisations given by the Board are reviewed on a regular basis.
There are no material conflicts currently in place save in respect of Jorge Cosmen’s position as a non-Independent Non-Executive Director and his association with the Cosmen family as a substantial shareholder