Board and Committee structure
Below is the Company’s governance framework which provides an overview of the roles, responsibilities and reporting lines of the Board and its Committees.
The owners of the Company and the persons to whom the Board is ultimately responsible.
Responsible for the overall leadership and governance of the Board and ensuring that it operates effectively through productive challenge and debate.
Collectively responsible to the Company’s shareholders for the long-term sustainable success of the Company, by providing effective leadership, establishing the Company’s Purpose and Values and monitoring its culture, setting the Company’s strategy and overseeing its delivery within a framework of internal controls, setting the Company’s risk appetite and reviewing its principal and emerging risks and taking other decisions reserved to it. Board members act for the benefit of shareholders while taking into account the interests of a range of other stakeholders and other factors in accordance with their duties, including under section 172(1) of the Companies Act 2006.
Committees operate under the delegated authority of the Board and within formal terms of reference. Their key responsibilities are set out below:
- Nominations Committee: Reviews the structure, size, composition and effectiveness of the Board and its Committees. Oversees succession planning for the Board and Senior Management, the development of talent and the promotion of diversity, and makes recommendations to the Board for the nomination of new Directors
- Audit Committee:Reviews and monitors the Group’s financial accounting and reporting processes and the integrity of published financial statements. Reviews the Group’s system of internal control, including the effectiveness of its internal audit function and the independence and effectiveness of its external auditor
- Safety & Environment Committee: Reviews and monitors the Group’s strategies, policies and standards, and its risk exposures and opportunities, in relation to safety and environmental matters and the Group’s performance of such matters.
- Remuneration Committee: Reviews and recommends to the Board the framework and policy for the remuneration of the Chairman, Executive Directors and Senior Management. Makes decisions within that framework and implements that policy.
- Disclosure Committee: Maintains governance procedures and controls for the identification, treatment and disclosure of inside information in accordance with applicable laws and compliance of disclosed information with the UK Listing Rules.
Board Executive Committee
A Committee comprised of the Group Chief Executive Officer and Group Chief Financial Officer operating under the delegated authority of the Board and within formal terms of reference. It acts to review and approve various executive matters, including bids and contracts, acquisitions and disposals, financing arrangements, and capital and operating expenditure below the levels reserved to the Board.
Group Executive Committee
An advisory and reporting body to the Group Chief Executive Officer comprised of divisional management and Group heads of function. It acts to review and oversee the safety, operational and financial performance of the Group and discuss, formulate and approve proposals for onward consideration by the Board or its Committees.
Setting the agenda
The Chairman and Company Secretary are responsible, in consultation with the Group Chief Executive Officer and Chairs of the Committees, for maintaining a scheduled 12-month programme of business for the Board and its Committees, with flexibility for additional business to be discharged as required. The programme ensures that all necessary matters are covered and appropriate time is given for discussion and, if thought fit, approval of relevant business.
At each scheduled Board meeting, the Board rigorously reviews reports from the Executive Directors, the Group General Counsel and the Company Secretary on the Company’s safety, operating and financial performance, investor relations, legal compliance and corporate governance. Other regular Board agenda items include strategic proposals (including those relating to acquisitions and disposals, bids for contracts and capital allocation), risk management (including reviews of risk appetite and risk registers), tax and treasury updates, human capital updates (including on employee relations, talent development and diversity promotion) and workforce and stakeholder engagement. Committee Chairs also provide summaries of the main decisions and recommendations arising from Committee meetings to ensure nonmembers are kept up to date with the work undertaken by each Committee.
The Board has a formal schedule of matters reserved for its approval, which matters include: strategy, risk appetite and review of Group-wide principal and emerging risks; major acquisitions and disposals (above certain values); bids and contracts (above certain values); share capital changes and debt financing; review of financial results and approval of business plans and budgets; setting and changes to key corporate policies; Board and Committee membership; and corporate governance arrangements. Other responsibilities and authorities have been delegated by the Board to its standing Committees, comprising its Nominations, Audit, Remuneration, Safety & Environment, Executive and Disclosure Committees. Any matters outside of these fall within the responsibility and authority of the Group Chief Executive Officer and/or Group Chief Financial Officer. The schedule of matters reserved to the Board and the terms of reference of each Committee, which are reviewed and approved by the Board annually, can be found on the Company’s website at: www.nationalexpressgroup.com
Section 172 of the Companies Act
In accordance with Section 172(1) Companies Act 2006, the Company’s Directors must act in a way that they consider, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to:
- Long term consequences
- Other stakeholders
- Community and environment
- Acting fairly between shareholders
The Board’s decisions are naturally made only after careful consideration of all relevant factors which include, but are not limited to, those specified in Section 172(1) Companies Act 2006. In a year dominated by the challenges of the Covid-19 pandemic, many of the Board’s principal decisions were taken in direct response to those challenges and the table here demonstrates which factors were considered and how those factors influenced the decisions taken.