BP 2014 Annual Report Download - page 65

Corporate governance
Board effectiveness
Induction and board learning
On joining BP, non-executive directors are given a tailored induction
programme. This includes one-to-one meetings with management, the
external auditors and field visits to operations. The induction also covers
governance, duties of directors, the work of the board committees
generally and specifically the committees that a director will join.
To help develop an understanding of BP’s business, the board continues to
build its knowledge through briefings and field visits. In 2014 the board
received training on BP’s code of conduct and briefings on key business
developments and changes to the UK Corporate Governance Code. The
board met local management and external stakeholders at its board
meetings in Istanbul and Chicago.
Non-executive directors are expected to attend at least one field visit per
year. In 2014 the board visited the Whiting refinery in the US and members
of the SEEAC visited BP’s operations in Baku and Brazil. After each visit,
the board or appropriate committee was briefed on the impressions gained
by the directors during the visit.
Board visit to the Whiting refinery
Ahead of its meeting in Chicago, the board visited the Whiting refinery.
Directors met the refinery’s leadership team as well as staff and
contractors on-site. They got a first-hand view of progress on the Whiting
refinery modernization project and an opportunity to see existing
operations.
As well as seeing the application of BP’s OMS★ at the refinery, the board
also heard details of the role the refinery plays in delivering results for
North America Fuels and the wider BP group.
Board evaluation
Each year BP undertakes a review of the board, its committees and
individual directors. The chairman’s performance is evaluated by the
chairman’s committee.
In 2014, an internally designed board evaluation for the board and the
committees was carried out using a questionnaire prepared by an external
facilitator (Lintstock). The evaluation tested key areas of the board’s work
including strategy, business performance, risk and governance processes.
The output of the committee reviews were discussed individually at each
committee meeting in December 2014. The output of the board review
was used as the basis for one-to-one interviews between each director
and the chairman. Results of the board evaluation and feedback from these
interviews were discussed by the board in January 2015.
Key conclusions from the evaluation
The evaluation, which considered the work of the board and its
committees, concluded that the processes of the board had worked well.
The evaluation focused on how the board would continue to ensure that it
was discussing the right issues and that, overall the board was adding
value.
Reports from the business and on major projects were in very good shape.
On the rapidly shifting economic and geopolitical climate, the board was
keen to ensure that it manages its time to allow appropriate levels of
discussion. The need to balance its monitoring activities with discussion on
strategic matters was recognized and ought to be continually borne in
mind. The future role of technology in delivering BP’s strategy was
highlighted.
Follow up from our previous evaluation
Following the 2013 evaluation, more agenda time was allocated to the
development of strategy and governance around capital projects, resulting
in the creation of a regular performance report on the group’s major
projects. The board also had a detailed briefing on the group’s view on
long-term technology trends and examined organizational capability,
including diversity and inclusion, at one of its strategic days.
★ Defined on page 252. BP Annual Report and Form 20-F 2014 61