RBS 2007 Annual Report Download - page 98

RBS Group • Annual Report and Accounts 2007
96
Report of the directors continued
Governance
Corporate responsibility
Business excellence requires that the Group meets changing
customer, shareholder, investor, employee and supplier
expectations. The Group believes that meeting high standards
of environmental, social and ethical responsibility is key to the
way it does business.
In 2007, the Group undertook a survey to identify and prioritise
the issues that stakeholders care about in relation to the
financial services sector. This allows the Group to focus
corporate responsibility activities on issues which matter most
to stakeholders. Financial crime and corruption is the primary
focus, followed by consumer banking issues, employee
practices, direct environmental impact, community investment,
global lending and project finance, financial inclusion and
capability and support for small businesses. The Group takes
all these responsibilities seriously, continually monitoring and
managing them through policies and practices across the
Group. The Board regularly considers corporate responsibility
issues and receives a formal report on these each year.
Further details of the Group’s corporate responsibility policies
will be contained in the 2007 Corporate Responsibility Report.
Going concern
The directors are satisfied that the Group has adequate
resources to continue in business for the foreseeable future.
For this reason, they continue to adopt the ‘going concern’
basis for preparing the accounts.
Corporate governance
The company is committed to high standards of corporate
governance. Details are given on pages 99 to 104.
Ordinary share capital
In May 2007, the company capitalised £1,576 million of its
share premium account by way of a bonus issue of two new
ordinary shares of 25p each for every one ordinary share held
by shareholders at close of business on 4 May 2007. As of
8 May 2007, the authorised ordinary share capital of the
company increased by £1,609 million (6,434,972,616 ordinary
shares of 25p each) and the allotted, called-up and fully paid
ordinary share capital increased by £1,576 million
(6,304,298,670 ordinary shares of 25p each).
During the year, the ordinary share capital was also increased
by 530.6 million ordinary shares issued to former ABN AMRO
shareholders and 19.1 million ordinary shares allotted as a
result of the exercise of options under the company’s share
schemes.
Details of the authorised and issued ordinary share capital at
31 December 2007 are shown in Note 26 on the accounts.
Preference share capital
Details of issues and redemptions of preference shares during
the year and the authorised and issued preference share capital
at 31 December 2007 are shown in Note 26 on the accounts.
Authority to repurchase shares
At the Annual General Meeting in 2007, shareholders renewed
the authority for the company to make market purchases
of up to 958,712,195 ordinary shares. The directors have not
exercised this authority to date. Shareholders will be asked to
renew this authority at the Annual General Meeting in April 2008.
Additional information
Where not provided previously in the Report of the directors,
the following provides the additional information required to be
disclosed by Part 7 of the Companies Act 1985 as amended.
Details of the ordinary and preference share capital are
provided in Note 26 on the accounts on pages 177 to 179.
The rights and obligations attaching to the company’s ordinary
shares and preference shares are set out in the company’s
Articles of Association, copies of which can be obtained from
Companies House in the UK or by writing to the Group
Secretary and General Counsel.
On a show of hands at a general meeting of the company
every holder of ordinary shares and cumulative preference
shares present in person or by proxy and entitled to vote shall
have one vote. On a poll, every holder of ordinary shares
present in person or by proxy and entitled to vote shall have
one vote for every share held. On a poll, holders of cumulative
preference shares present in person or by proxy and entitled
to vote shall have four votes for every share held. The Notice
of the Annual General Meeting specifies the deadlines for
exercising voting rights and appointing a proxy or proxies to
vote in relation to resolutions to be passed at the general
meeting.
The cumulative preference shares represent less than 0.04% of
the total voting rights of the company, the remaining being
represented by the ordinary shares.
There are no restrictions on the transfer of ordinary shares in
the company other than certain restrictions which may from
time to time be imposed by laws and regulations (for example,
insider trading laws). Pursuant to the Listing Rules of the
Financial Services Authority certain employees of the company
require the approval of the company to deal in the company’s
shares.
A number of the company’s share plans include restrictions on
transfers of shares while the shares are subject to the plans, in
particular the Employee Share Ownership Plan.
The rights and obligations of holders of non-cumulative
preference shares are set out in Note 26 on the accounts on
page 179.
The company is not aware of any agreements between
shareholders that may result in restrictions on the transfer
of securities and/or voting rights. There are no persons holding
securities carrying special rights with regard to control of
the company.