Women On Boards Report 6 Month Review Produced By Pinsent Masons


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Women On Boards Report 6 Month Review Produced By Pinsent Masons

  1. 1. Women on BoardsThe Davies Report :how the landscape has changed six months on
  2. 2. Women on Boards The Davies Report – 6 months on - what has been achieved? Gender balance in the boardroom – and the wider question of promoting women into senior executive roles – has continued to make the headlines since the Davies Report was published in February this year. The debate that has followed has raised many issues, demonstrating there are no simple answers to the underlying causes, or even agreement as to what those causes are. What is clear is that there is no shortage of qualified women keen and able to take up positions on boards – fourteen of the 21 appointments of women directors to FTSE 100 boards in the last six months have been appointments of women with no prior FTSE 100 or FTSE 250 board experience. That begins to meet a major objective of the Davis Report - that new talent pools should be explored by chairmen and nomination committees when appointing non-executive directors. Pinsent Masons has continued its focus on these issues and in this report we look at five areas – • What companies have said and done in the last six months - the Cranfield Report into progress on the Davies recommendations • The UK Corporate Governance Cose: the impact of the Davies Report - changes to the Code to implement the Davies recommendations • Diversity disclosures: changes to the Companies Act - what will have to be disclosed from 2012 onwards • The role of the Non-executive Director and the FSA - a focus on NEDs and the merits of diversity • Mentoring and Sponsorship - what’s involved and what each can achieve Please do get in touch if you would like to attend future events, or share your thoughts and experiences on Women on Boards and achieving gender diversity in the boardroom. Martin Webster Head of Corporate Governance martin.webster@pinsentmasons.com “With women making up 60% of graduates coming out of our universities, there are compelling business reasons for companies to engage in this debate. Experience in Europe suggests that legislation will follow if companies do not themselves address the issue of gender diversity in the boardroom.” Martin Webster Partner1 WOMEN ON BOARDS
  3. 3. What companies havesaid and done in thelast six monthsThere is still a long way to go and too many companies fail to recognisethe potential of women in leadership positions. We remain optimistic,however, that the voluntary approach... will deliver the necessarychanges... The best and most forward-thinking businesses are alreadyputting in place innovative solutions to help women succeed in theworkplace Government Foreword to Women on Boards, 6 month Monitoring Report, October 2011Lord Davies gave FTSE 350 companies six More important is for a company to decidemonths to announce the number of women its own target, the timeframe within whichdirectors they are aiming to have by 2013 it can reasonably expect to achieve it, andand 2015. Cranfield School of Management to measure and report on progress towardsundertook to monitor the announcements that goal. A company starting this processand reactions from those companies and with an all male board will have a greatertheir report, published in mid-October, task than others and may legitimately setmakes interesting reading. itself a target below 25%.The figures An example of a company which adopted this approach – but it was the only one –The headline figures have been well was Senior plc from the FTSE 250, whichreported: the percentage of women on FTSE currently has no women directors and set100 boards has grown to 14.2%, though itself a target of 15% by 2015. Far fromonly 22.5% of all appointments since 1 criticising this response as falling short,March 2011 were women, compared to the Cranfield hold it up as an example of a33% Davies called for. In all, there have realistic approach which meets the “The aim of targetsbeen 21 appointments of women directors intention behind Davies. is for companiessince Davies published his report. to self-determine Equally, companies which already have what isIn the FTSE 250 the position was worse, with good female representation might be reasonablyonly 18% of all new board appointments expected to aim higher. Davies wanted to achievable withinbeing women, giving a total of 8.9% women see FTSE 100 chairmen aspire to at least a givendirectors. 28 women were appointed to 25% female representation by 2015 and timeframe, fromFTSE 250 boards since 1 March. Cranfield note that only five companies a given starting were ambitious enough to name a 30% point, and to holdMore encouraging for Davies is the news target. As 27 already have at least 20% themselvesthat all-male boards are now a minority in women directors, the researchers label accountable forthe FTSE 250 (while 14 companies in the this response as disappointing. It mayFTSE 100 have no women). also not be enough to satisfy the their stated European Commission which has called goals.”The importance of targets for publicly listed companies to commit to 30% women directors by 2015 and Women on Boards,Much of the media focus may have been on 40% by 2020. 6 monththese numbers, but the Cranfield report Monitoring Report,suggests that the 25% by 2015 target set by Warm words on diversity might be October 2011Davies is not necessarily sacrosanct. welcome, the report suggests, but may achieve little unless supported by WOMEN ON BOARDS 2
  4. 4. measurable targets and clear reporting on particular the example of BHP Billiton “It would appear progress. Cranfield conclude that an discussed below. that it was absence of these elements "suggests that those while some companies might have the Executive appointments companies who positive intent of addressing the issue of are already on gender diversity on their boards, they may Of the 21 new women directors in the the journey lack a credible strategy for doing so". FTSE 100, three were executive who were appointments. In the FTSE 250, two of the willing to make The changes in the UK Corporate 28 women who joined company boards did Governance Code reported in the next so in executive roles. the section are going to be a catalyst for commitment change in company reporting. Only 20% The Davies Report also looked at to a target. ” of FTSE 100 companies and 7% of the FTSE positions below board level, calling on 250 referred to gender diversity in chief executives to review the percentage Women on Boards, reporting the work of their nomination of women they aim to have on their 6 month committees. executive committees in 2013 and 2015. Monitoring Report, Cranfield found only four companies in October 2011 The talent pool the FTSE 350 who responded. One of them was the mining giant Rio Tinto who One possible consequence of the Davies disclosed that they have 14% women in push for more female appointments might senior management and have set a target be that the same women who already sit on of 20% by 2015. FTSE 350 boards simply get more offers, rather than new women being recruited Indeed, Cranfield found poor levels of (some reports suggest this has happened in reporting on gender diversity below board Norway, as a result of their 40% requirement level. Only 28% of FTSE 100 companies for women directors). Cranfield suggest this reported on the number of women in risk may have been avoided, with 14 of the senior executive roles and that figure fell to 21 new FTSE 100 appointments having no 10% for the FTSE 250. As we report below, prior experience on a FTSE 350 board. these disclosures are due to become compulsory under changes to the The research also looked at the background Companies Act due in October 2012. of those women appointed to FTSE 100 boards and found that 57% had been in Cranfield’s report contains a brief case finance and 14% were from HR. A further study of BHP Billiton, the Anglo-Australian 14% had experience of senior operational mining group, which currently has 10% of positions. Finance and operational roles also senior management jobs held by women. In featured strongly in the FTSE 250. addition to aiming for 25% women directors by 2013, they explain in their Cranfield note that a common reason annual report how each business within offered by some boards for a lack of senior the group has been required to develop and women is that their companies operate in a implement a diversity plan as part of its male dominated sector. The researchers’ performance requirements, a factor then response is to point out that the FTSE 100 taken into account in assessing bonus companies that signed up to the remuneration. Progress against measurable 25%/2015 target include those operating in objectives for the proportion of women in the Mining, Oil & Gas, Automobiles, senior management, on the board and in Engineering, Construction & Materials and the workforce as a whole is to be disclosed Aerospace and Defence sectors. See in each year. “Doing nothing is no longer an option. Boards now need to set targets and report on the progress which is being made against those targets. Companies which genuinely try to achieve their targets are unlikely to be criticised if they fall short. Companies which do nothing could find themselves being singled out for criticism.” Justine Howard Legal Director3 WOMEN ON BOARDS
  5. 5. The UK CorporateGovernance Code: theimpact of the DaviesReportThe search for board candidates should be conducted, andappointments made, on merit, against objective criteria and with dueregard for the benefits of diversity on the board, including gender. Supporting Principle B.2 UK Corporate Governance CodeAdoption of the new Supporting Principle B.2 in Boards will need to talk about and disclose2010, with its explicit reference to gender, was a their policy, objectives and progress oncontroversial move for some. With the diversity in general - for example, in terms ofsubsequent publication of the Davies Report age, background, race and nationality - as welland its recommendations for further changes to as focussing in particular on gender diversity.the Code, the Financial Reporting Council (whichhas responsibility for the Code) consulted on It will be up to each board to decide whichhow these might be achieved. Following that areas of diversity are relevant to it (the FRCconsultation, the FRC has announced that for did not want to prescribe a list of every aspectfinancial years beginning on or after 1 October to be covered) but gender was deemed worthy2012 two amendments will be made to the of special mention because a lack of womenCode to support the Davies recommendations.. around the boardroom table runs the risk of “group think”, as well as suggesting that theDiversity policy, measurable talent pool of eligible women is not being fullyobjectives and disclosure on exploited. In addition, the FRC suggests thereprogress may be a poor understanding of women as customers and employees and littleCode Provision B.2.4 already requires the annual encouragement for aspiring female executives.report of a premium listed company to describethe work of the board’s nomination committee, The second subtle shift from the words used bythe process it uses for board appointments and Davies appears in the reference to “anyan explanation if either the chairman or a measurable objectives”. Davies wanted annon-executive director has been appointed absolute requirement that companies shouldwithout using head hunters or open advertising. set measurable objectives as part of theirThe amended B.2.4 will add specific diversity policy, on the principle that what getsrequirements for disclosure on diversity – measured gets done. The FRC has taken the view that, if the policy is not to be restricted toA separate section of the annual report should gender, it is unrealistic to expect companies to... include a description of the board’s policy on come up with objectives for a range of diversitydiversity, including gender, any measurable aspects, and it would be inconsistent to singleobjectives that it has set for implementing the out gender. Instead, companies should be leftpolicy, and progress on achieving the objectives. to decide what areas, if any, they think would benefit from having a specific objective. If (asThere are two points here where the Code the Cranfield research would suggest) manydiverges from what Davies recommended. First, companies are unhappy with targets for womenhe asked boards to establish a policy on directors, they will be relieved that there is to“boardroom diversity”, but made no specific be no obligation to introduce them.reference to gender. The new language herefollows the formula used in the Code’s 2010 In any event, locating these requirements in achange and refers to “diversity, including gender”. Code Provision means that companies are free to apply them on a “comply or explain” basis: they WOMEN ON BOARDS 4
  6. 6. can disclose a diversity policy and measurable Supporting Principle such as this carries no objectives and their progress in achieving them, specific requirement either to explain how its or they can explain why they choose not to terms have been applied (as there is with a Main comply with any or all of those elements. Principle under the Listing Rules), nor to comply or explain as with the Code Provisions. A The ability to explain non-compliance will not Supporting Principle just provides additional always be an easy option. A credible explanation guidance on what the Main Principle entails. will be difficult if the board has not even considered its approach to diversity. A number The FRC comments that the investors who of institutional investors have expressed an responded to its consultation were strongly in interest in what companies are doing on favour of it, which mirrors recent calls from diversity and are likely to challenge poor investors for increased transparency on reasoning. The EU is also keen for regulatory boardroom evaluations. intervention where the quality of explanation is unconvincing. What isn’t in the Code Board evaluations and gender No other changes to the Code are proposed. diversity The 30% Club argued for a requirement to set and publish a target for women at senior The FRC takes the view that diversity, and management level but, having declined to do specifically gender diversity, is a key element in that for the board, the FRC also passed on that ensuring the effectiveness of a board. It follows, more ambitious request. therefore, that the requirement in Main Principle B.6 – The consultation on Code changes also asked whether more detail should be given as to what The board should undertake a formal and a boardroom diversity policy might contain. rigorous annual evaluation of its own Answers for and against were evenly divided, performance and that of its committees and and in response the FRC has confirmed that it individual directors has no current intention of issuing further guidance on the topic, but will keep the point should include a consideration of the make-up under review. of the board in terms of gender diversity. When will these changes take Board evaluations continue to be an area many effect? companies struggle with. Whether they are purely internal, whether external help is sought, The October 2012 date for introducing these the form they take and how they are reported changes was chosen to coincide with other raise questions each year. The FRC has taken expected changes to the Code concerning audit this opportunity of putting a little flesh on the committees and re-tendering for audit bare bones of Main Principle B.6 by adding a mandates, as well as new legislation expected new Supporting Principle – from the government requiring disclosures on gender diversity (see below). In the meantime, Evaluation of the board should consider the the FRC has followed Davies’s lead and balance of skills, experience, independence and companies are “strongly encouraged” to treat knowledge of the company on the board, its these Code amendments as applying to earlier diversity, including gender, how the board works accounting periods. For companies with a together as a unit, and other factors relevant to December or March year end, there may its effectiveness therefore be some pressure to include these disclosures in annual reports for the current Note again the reference to “diversity, including accounting periods, and certainly for the gender”, suggesting that other aspects of following years to 31 December 2012 and 31 diversity may be relevant and need to be March 2013. assessed. It is also worth remembering that a “Davies wasn’t just looking at gender, but the benefits of diversity in all its forms, and the new Code will reflect that”.” Linda Jones Partner5 WOMEN ON BOARDS
  7. 7. Diversity disclosures:changes to theCompanies ActA further recommendation of the Davies Report there is a potential difficulty in defining what iswas that listed companies should disclose the a “senior executive position” and have asked forproportion of women directors and employees views on how this might be done. Whatever thein three areas: definition, and regardless of how big or small the resulting group may be, the fact that it is a the main board proportion or percentage figure that is asked for senior executive positions and should meet the Davies objective. the workforce as a whole. Disclosure of figures for the whole workforceIn September the Government published a may also be difficult where there is no groupconsultation paper, The Future of Narrative wide HR database, particularly for thoseReporting, which proposes a major change to companies with overseas operations. Thethe current form of narrative reporting in a suggestion here is that disclosure is made forcompany’s Annual Report. The “front end”, those parts of the business where information iscurrently comprising the Business Review and available, with an explanation of theDirectors’ Report, is to be replaced by approximate proportion of the global workforce the figures relate to. Companies should also a Strategic Report which will set out the name those countries and regions where gender company’s strategy and direction and the information for their operations is not available challenges it faces, with high level or difficult to obtain. information on the company’s finances and remuneration, and These changes are due to be made in time for accounting years beginning on or after 1 an Annual Directors’ Statement which will October 2012. support the Strategic Report with more detailed information set out in a prescribed layout with standard headings.As part of these changes, the Governmentproposes to include a requirement that theStrategic Report discloses each year theproportion of women in the three categoriesidentified by Davies. They recognise, however, “The shake up in the format of the Annual Report scheduled for next year is going to be a major exercise for many companies, and gathering diversity statistics will be part of that.” Helen Ridge Partner WOMEN ON BOARDS 6
  8. 8. The role of the Non - Executive Director and the FSA The FSA’s focus on NEDs  governance, oversight and control  the appropriate regulatory framework and requirements. Our ARROW visits now focus more on firm’s governance mechanisms and the role played by The FSA does not expect every non-executive to directors, especially NEDs. possess all of these qualities, but each needs to be represented on a board. More particularly, FSA Policy Statement 10/15: Effective Corporate Governance not everyone needs to be an industry specialist. What is required is that there is a balance of One result of the financial crisis has been a skills and knowledge across all board members renewed focus by regulators on non-executive and that each NED possesses a number of these directors and what they have, or have not, been relevant skills. Any shortcomings in terms of doing. The Walker Review into corporate specialist knowledge of the industry can be governance at banks and other large financial addressed by a tailored induction and a institutions identified failings in their challenge continuing training programme. The FSA takes and oversight role. As a result, the Financial the view that the most effective inductions Services Authority has developed a new topic include NEDs spending time in the business and for its periodic inspections, as evidenced by the meeting people below board level. To reinforce above quotation. the point that lack of industry expertise is not fatal, the regulator is on record as saying – There is no comprehensive definition of the role of the NED in the FSA’s Handbook and so Having a structured [induction] plan can give a firm concepts are freely borrowed from the UK the confidence to appoint non-financial specialists. Corporate Governance Code developed by the Financial Reporting Council, a quite separate Governance in retail firms – feedback from Winter 2010 seminars body. (For more on what the Code says on the role of the NED, click here.) The drawback of this All directors of FSA regulated firms need to be approach is that some of these borrowings may approved by the Authority and, as part of its miss the point that much of the detail of the new more intrusive regime of regulation, it will Code is not obligatory but rather to be applied interview those proposed for board positions in on a comply or explain basis. If an FSA regulated the biggest companies and where concerns have firm believes that a particular Code Provision is been raised in smaller firms. Such sessions are not appropriate for the way it organises itself rigorous and need detailed preparation by the and that an aim of the Code can be best individual in conjunction with the company and achieved by another route, it should be free to its advisers, though the proposed director must explain and follow that alternative. attend the interview alone. Some have resulted in the FSA indicating that approval is unlikely There is, however, some guidance in the FSA’s and the candidate has withdrawn as a result. Fit and Proper Test for Approved Persons on the key competencies they would expect from a This initial interview is not the end of the non-executive director at a regulated firm – approval process. NEDs need to be able to demonstrate their credentials on an on-going  market knowledge basis. The FSA is interested in regular reviews of  an understanding of the business’s strategy the effectiveness of individual directors, the and business model board and its committees, though, in contrast  risk management and control with the UK Corporate Governance Code, there  financial analysis and control is no preference for externally facilitated evaluations over internal reviews, saying each is “equally valuable”.7 WOMEN ON BOARDS
  9. 9. The FSA and diversity The FSA has nonetheless put itself on record, in its response to the same EU green paper, asGiven the FSA’s interest in good governance, the opposing quotas which “could raise the risk thateffectiveness of boards and the quality of people are appointed just to fulfil the quota,nonexecutive directors, one might have thought rather than because they have the rightthey would have a view on diversity. If they do, qualities needed by that board at that time”.it seems at best luke warm – The FSA’s view that diversity brings manyWhile the FSA does not have a specific equality and benefits was certainly shared by others during adiversity objective or have targets for the number of panel discussion at a Pinsent Masons seminar inwomen or other groups being authorised to carry out early October. Women are seen as more likely toSignificant Influence Function roles, we are challenge, to ask the penetrating question, andpermitted ... to monitor which groups are less likely to accept the status quo. And yet, inrepresented among those individuals we approve an area where risk management is critical, theand to act as advocates for equality and diversity financial services sector is particularly short ofgenerally within the firms that we regulate. women in senior leadership roles. The more forensic, more persistent, approach displayed byFSA Policy Statement 10/15: Effective Corporate many women, should be a key attribute for the Governance boards of FSA regulated entities.The conflict the regulator faces stems from the There is, of course, a balance to be struckemphasis in the Walker Review and elsewhere between, on the one hand, challengingon competency and a thorough understanding colleagues and questioning received opinionof a firm’s business. To paraphrase crudely: and, on the other, risking the collegiality andbetter to be safe with a board of white, Anglo- unity of a board. One tip offered at the seminarSaxon males in late middle age who have suggested that a sole woman newly appointedspecific industry expertise, than be sorry with a to a board should find an ally amongst her maleboard, diverse in terms of gender, age and colleagues, someone who might also look at thebackground, but with some members lacking world differently and be prepared to back her upthat comprehensive sectoral experience. in the points she makes, or at least to warn from experience when another course of actionThe FSA recognises the dangers of this might achieve better results.approach. In the same policy statement quotedabove, it said – In any event, diversity on a board is about more than gender, and diversity at the top of aOur focus on individuals’ experience and business can be a sign of health and strength.qualifications could increase the conformity andhomogeneity of those at the top of the UK financial That point led to a question from the floor: wasservices industry, with the risk that levels of challenge a macho, winner-takes-all culture at certainand alternative points of view are reduced.... banks the root cause of the financial crisis? It can’t be denied that most CEOs are men and areIndeed they share the FRC’s views on the likely to have displayed macho traits in theirbenefits of diversity – rise to the top. But tempting as such an easy analysis might be, the reality is more likely to beHaving a more diverse board may help deliver better found in a wide variety of behavioural andregulatory outcomes, as increased diversity produces economic factors.a wider range of perspectives, thought andapproaches to solving regulatory problems and canhelp avoid the danger of “group think”.FSA response to EU Commission green paper:Corporate Governance in Financial Institutionsand Remuneration Policies, 31 August 2010 “Despite some of its more positive statements, it seems the regulator is unlikely to be telling boards they should be improving their governance by appointing more women nonexecutive directors.” Tim Dolan Partner WOMEN ON BOARDS 8
  10. 10. Mentoring and Sponsorship One obstacle to greater diversity in the boardroom is that many women do not have access to the role models and champions required to succeed at a more senior level. At our seminar in early October, we invited if the two parties feel comfortable with each Gillian Wilmot, Anne Boden and Margaret other and there is a free exchange of ideas. Young, three women who have achieved senior positions in financial services, to discuss the role Alternatively, there may be a more formal that mentoring and sponsorship can play and framework to a mentoring relationship, with the how to tap into that expertise. two parties agreeing a set of expectations and objectives and a defined timeframe. Whichever Mentoring model is chosen, it has to be bespoke and designed specifically for the needs of the Mentoring is the transfer of skills and individual mentee. No one solution will suit all knowledge from a highly experienced leader needs. Indeed, rather than stick with one long who has faced similar challenges to a less term appointment, a change of mentor can be experienced individual wanting to progress in beneficial as the mentee develops and new their career. The mentee learns from the challenges are faced. mentor’s successes and mistakes, and receives trusted, confidential advice on meeting the Internal or external challenges they encounter and achieving their objectives. The mentor provides encouragement, Should a mentor be internal, an insider at the urges persistence and gives reassurance that the same organisation as the mentee, or is it better mentee has the qualities to succeed. to find someone external who can take a more objective view? As well as empathising with the Mentoring needs to be distinguished from mentee, a mentor will ideally understand the coaching. A coach teaches specific skills but organisation concerned, the way it works, the may not have personal experience of the role personalities involved, its own ambitions and concerned. Mentoring can be a much more the way they are to be achieved, and that may informal arrangement, comprising regular best be done by an internal appointment. conversations, swapping of experiences and the Keeping things in-house will also minimise occasional warning or word of caution. Much of issues with sharing information which might be a mentor’s role may consist of listening to the price-sensitive or at least confidential to the mentee talk about the issues they face, their business (though an external mentor will also ambitions and the route they have planned to be bound by confidentiality and expect to sign achieve their aims. That will trigger advice from an agreement to that effect). An internal the mentor’s own career, along with mentor can also act as a sponsor for the observations from having faced similar mentee. situations. Such a relationship will develop well "Companies serve their customers and stakeholders best when the leadership team is diverse and where there is diversity of thinking." Gillian Wilmot Board Mentoring9 WOMEN ON BOARDS
  11. 11. But there are drawbacks. Internal appointments A sponsor need not be a mentor – the formermay be more informal and less structured, with promotes the individual to the powers that be,the mentor struggling to find the time needed while the latter advises and encourages theto devote to the role (attending master classes individual direct, as discussed above. But anin effective mentoring can pay real dividends for internal mentor may broaden the role to act asan internal mentor). They may also lack outside a sponsor as well. Discussions with the menteeexperience and independence and be too close may bring out more fully the qualities theto the organisation concerned to take a truly individual possesses and spur the mentor toobjective view. At worst, they may have their share their knowledge of new talent withown agenda and interests which can conflict others. If an organisation puts in place anwith those of the mentee. internal mentoring programme, with senior individuals pairing up with more juniorSponsorship executives, talent spotting is bound to result, with the best being fast tracked for earlyHaving a sponsor, someone who speaks up for promotion.you, puts your name forward and recommendsyour advancement, is important for all, both Our Panelmen and women. The problem is that most ofus tend to recruit and promote in our own Gillian Wilmot - founder ofimage and, when faced with alternatives, we BoardMentoring.com and currently a nonfollow the easy route of choosing someone like executive director at Pockit.com and a chair inus. If the majority of senior roles are held by the public sector; formerly a director at Next,men, there is a risk they will sponsor more men Royal Mail and Admiral Group.like them and the benefits of diversity are lost.Older men can, in any event, be understandably Anne Boden – former chair, Royal Bank ofwary of being seen to sponsor younger women, Scotland EMEA board for Global Transactionfor fear of the innuendo which may follow. And Services; previously Chief Information Officerwithout a sponsor, an individuals’ progress and board member at Aon Limited; currently awithin an organisation can be all the more member of the Board of Governors at Middlesexdifficult. University.It is one of the attributes of a good leader that Margaret Young – chairman at Cattles andthey spot tomorrow’s stars early, bring people Welcome Financial Services (formerly executiveon and promote their cause. Most sponsors will chairman for a two year period of operationalbe internal and are key when seeking to and financial restructuring); previously seniorprogress in the same organisation, but a high independent director at Unigate and supervisoryprofile backer from outside can be equally board member at Royal Numico NV.influential when applying for external roles.Anyone giving a reference is, one hopes, aneffective sponsor. WOMEN ON BOARDS 10
  12. 12. Appendix The Role of the Non- Executive Director - UK Corporate Governance code What the Code says  being satisfied as to the integrity of financial information The UK Corporate Governance Code highlights  being satisfied that financial controls and the two main features of the role: systems of risk management are robust and defensible  constructive challenge  help in developing stratergy  deciding appropriate levels of remuneration for executive directors Main Principle A.4  a prime role in appointing and removing Note the qualifications in each case: challenge executive directors should be constructive and designed to advance the debate rather than challenge just for the  a prime role in succession planning sake of it; and the role of the non-executive directors in strategy is to assist the chief  understanding the views of major executive and senior management in their shareholders. developing of a plan, rather than to claim it as their sole preserve. More is said on each of these points in Martin Webster’s User’s Guide to the UK Corporate Read further into the Code and other roles are Governance Code which can be downloaded assigned to the non-executives on the board without charge from our website at across a range of governance issues – www.pinsentmasons.com.  scrutinising the performance of UK Corporate Governance Code management  monitoring reporting of the company’s performance Useful links Board Mentoring www.boardmentoring.com Corporate Heart Corporate Heart is a Performance Consultancy which primarily works by developing people to enhance results. Pauline Crawford, CEO and her team provide new perspectives on human interaction in business, designed to build sustainable growth, success and capability. Their latest research addresses “What men think about women at work” www.corporateheart.co.uk Cranfield monitoring report Downing Street press release http://www.number10.gov.uk/news/pm-welcomes-progress-on-women-on-boards/11 WOMEN ON BOARDS
  13. 13. © Pinsent Masons LLP 2011 LONDON DUBAI BEIJING SHANGHAI HONG KONG SINGAPORE OTHER UK LOCATIONS: BIRMINGHAM BRISTOL EDINBURGH GLASGOW LEEDS MANCHESTER International: T +44 (0)20 7418 7000 UK: T 0845 300 32 32Pinsent Masons LLP is a limited liability partnership registered in England & Wales (registered number: OC333653) authorised and regulated by the Solicitors Regulation Authority. The word partner, used inrelation to the LLP, refers to a member of the LLP or an employee or consultant of the LLP or any affiliated firm who is a lawyer with equivalent standing and qualifications. A list of the members of the LLP,and of those non-members who are designated as partners, is displayed at the LLPs registered office: 30 Crown Place, London EC2A 4ES, United Kingdom. We use Pinsent Masons to refer to Pinsent Masons LLP and affiliated entities that practise under the name Pinsent Masons or a name that incorporates those words. Reference to Pinsent Masons is to Pinsent Masons LLP and/or one or more of those affiliated entities as the context requires. Further information about us is available at www.pinsentmasons.com. www.pinsentmasons.com