BP 2009 Annual Report Download - page 73

BP Annual Report and Accounts 2009
Board performance and biographies
Board performance and biographies
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BP’s general auditor (head of the internal audit function) reports on the
design and operation of risk management activities across the group and
attends meetings of both the audit committee and SEEAC. The general
auditor has direct access to the chairs of both committees and holds
regular meetings with them outside formal meetings.
Within the company, BP has an annual certification process in
which team leaders are asked to discuss with their teams and then
submit a certificate regarding their and their team’s understanding of and
adherence to BP’s code of conduct and the reporting of any breaches or
risk of non-compliance. The certification system enables the risk of non-
compliance to be assessed and reported alongside other business risks.
Board meetings and attendance
The board met 12 times during the year, of which two meetings were
two-day strategy sessions and three meetings were by telephone.
Board meetings Board meetings
eligible to attend attended
P D Sutherland 12 10
Sir Ian Prosser 12 12
A Burgmans 12 12
C B Carroll 12 11
Sir William Castell 12 11
G David 12 12
E B Davis, Jr 12 10
D J Flint 12 10
D S Julius 12 12
Sir Tom McKillopa5
C-H Svanbergb4
I C Conn 12 12
R W Dudleyc8
B E Grote 12 12
A B Hayward 12 12
A G Inglis 12 11
aRetired from the board on 16 April 2009.
bJoined the board on 1 September 2009.
cJoined the board on 6 April 2009.
International advisory board
In 2009, BP formed an international advisory board whose purpose is
to advise the chairman, group chief executive and board of BP plc on
strategic and geopolitical issues relating to the long-term development
of the company. The international advisory board met twice in 2009.
The chairman, senior independent director and
non-executive directors
Neither the chairman nor the senior independent director is employed as
an executive of the group. The board is required to develop and maintain
a plan for the succession of both the chairman and senior independent
director. During 2009, these posts were held by Peter Sutherland and
Sir Ian Prosser respectively. Sir Ian Prosser also held the post of deputy
chairman during the year – a role which will cease on his retirement.
The chairman
Upon Peter’s retirement, I took the chair on 1 January 2010. The process
for my appointment and induction programme is outlined below.
I stepped down as CEO of Ericsson on 31 December 2009, but will
remain on the Ericsson board as a non-executive director. I had no other
significant commitments at the time of my appointment as chairman.
The chairman’s role is to provide leadership of the board, act
as facilitator for meetings, maintain the integrity of the governance
framework and have overall responsibility for ensuring the board’s
effectiveness. Other responsibilities include leading the board’s
performance evaluation and overseeing the board learning and
induction programme.
The chairman is tasked with setting the agenda for the board in
consultation with the group chief executive and with the support of the
company secretary. The chairman ensures that systems are in place to
provide directors with accurate, timely and clear information concerning
the business of the board and the company.
Between board meetings, the chairman has authority to act
and speak for the board on all matters relating to the role of the board.
He also has responsibility for ensuring the relationship with executive
management is working well.
The chairman represents the views of the board to shareholders
on key issues, in particular those relating to the work of the board
including succession planning. He keeps the board briefed on those
views. In November I was able to meet a number of our institutional
shareholders as part of my induction. I found these to be productive
meetings and comment on them, and on the board engagement which
has taken place during the year, in further detail below.
The senior independent director
The senior independent director acts for the chairman in his absence or
at his request, and is available to shareholders if they request a meeting
or have concerns which contact through the normal channels has failed
to resolve or where such contact is inappropriate.
The senior independent director is available to act as a
communication channel between the chairman and other board
members and, when necessary, to provide a sounding board for the
chairman. He also has responsibility for leading the annual performance
review of the chairman.
Sir Ian Prosser will retire from the BP board at the AGM in April
2010. Sir William Castell will become the senior independent director
from that date.
Sessions of the non-executive directors
The chairman and all non-executive directors meet periodically without
the presence of executive management as the chairman’s committee.
The work of the committee during the year is outlined in the report
below.
Board composition
During the year, the number on the board has fluctuated. As at
26 February 2010, the board is composed of the chairman, nine non-
executive directors and five executive directors; over half the board is
therefore made up of independent non-executive directors. We state
that the number of directors should not normally exceed 16.
This is a large board, however, given the scale and scope of BP’s
business we believe that it is appropriate. We need to have a broad and
experienced group of directors who are able to contribute to a discussion
on strategy and risk whilst having the right skills to work on the
committees. We believe it is important to have a strong group of
executive directors who recognize their board responsibilities as directors
and not solely to represent the activity in the company for which they are
responsible. This adds to open and constructive debate and
demonstrates one of the strengths of a unitary board.
Sir Tom McKillop retired from the board on 16 April 2009 and Peter
Sutherland retired on 31 December 2009. Bob Dudley joined the board as
an executive director on 6 April 2009 and I became a BP non-executive
director and chairman designate on 1 September 2009. Paul Anderson
joined the board on 1 February 2010 and Ian Davis will join the board on
2 April 2010. Finally, two of our longest serving directors will be retiring at
the AGM in April 2010: Sir Ian Prosser and Erroll Davis, Jr.
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