RBS 2011 Annual Report Download - page 264

262 RBS Group 2011
Diversity
At its meeting in June 2011, the Group Nominations Committee
considered a letter from Lord Davies recommending that a Board
discussion be held prior to the announcement of aspirational diversity
targets in September 2011. The statement released in September 2011
announced that the Group is supportive of Lord Davies’
recommendations and aspires to meet the target of 25 per cent female
board representation in 2012 as set out in Lord Davies’ report and
confirmed that the Group will continue to meet or exceed this standard. In
December 2011, in accordance with the recommendations contained
within Lord Davies’ report, the Board established a boardroom diversity
policy including measurable objectives for implementing the policy.
The Group understands the importance of diversity and recognises the
importance of women having greater representation at key decision
making points in organisations. The search for Board candidates will
continue to be conducted, and nominations/appointments made, with due
regard to the benefits of diversity on the Board. However, all
appointments to the Group Board are based on merit, measured against
objective criteria, and the skills and experience the individual can bring to
the Group Board.
The balance of skills, experience, independence, knowledge and diversity
on the Board, and how the Board operates together as a unit is reviewed
annually as part of the Board evaluation. Where appropriate, findings
from the evaluation will be considered in the search, nomination and
appointment process. If appropriate, additional targets on diversity will be
developed in due course.
Further details on the Group’s approach to diversity can be found on
page 299.
Succession planning
The Group Nominations Committee considers succession planning on an
ongoing basis. The Board considered talent and succession planning for
the Group Chief Executive and each member of the Executive Committee
at a meeting in June 2011. The meeting concluded that the executive
team was extremely strong and the Board should continue to monitor the
position as industry developments progress.
Group Sustainability Committee
The Group Sustainability Committee (GSC) is chaired by the Senior
Independent Director and meets quarterly. The GSC is responsible for
reviewing the Group’s overall sustainability strategy, values and policies
and aligning the Group’s approach to ethical, social and environmental
issues. All key business areas are represented on the GSC and it is
attended by the Group Chairman. For more information on the
governance framework which supports the GSC see page 30. Further
details of the Group’s sustainability policies are available on the Group’s
website www.rbs.com/sustainability and in the Annual Sustainability
Report.
Relations with shareholders
The Chairman is responsible for ensuring effective communication with
shareholders. The company communicates with shareholders through the
Annual Report and Accounts and by providing information in advance of
the Annual General Meeting. Individual shareholders can raise matters
relating to their shareholdings and the business of the Group at any time
throughout the year by letter, telephone or email via the Group’s website
www.rbs.com/ir.
Shareholders are given the opportunity to ask questions at the Annual
General Meeting or can submit written questions in advance. Directors
including the chairs of the Group Audit, Board Risk, Group Remuneration
and Group Nominations Committees are available to answer questions at
the Annual General Meeting. The Senior Independent Director is also
available.
Communication with the company's largest institutional shareholders is
undertaken as part of the Investor Relations programme:
xthe Group Chief Executive and Group Finance Director meet
regularly with UKFI, the organisation set up to manage the
Government’s investments in financial institutions, to discuss the
strategy and financial performance of the Group. The Group Chief
Executive and Group Finance Director also undertake an extensive
annual programme of meetings with the company’s largest
institutional shareholders.
xthe Chairman independently meets with the Group’s largest
institutional shareholders annually to hear their feedback on
management, strategy, business performance and corporate
governance. Additionally, the Chairman, Senior Independent
Director and chairs of the Board Committees met with the
governance representatives of a number of institutional
shareholders during the year.
xthe Senior Independent Director is available if any shareholder has
concerns that they feel are not being addressed through the normal
channels.
xthe Chair of the Group Remuneration Committee consults
extensively with institutional shareholders in respect of the Group’s
remuneration policy.
Throughout the year, the Chairman, Group Chief Executive, Group
Finance Director and Chair of the Group Remuneration Committee
communicate shareholder feedback to the Board and the directors
receive independent analyst notes and reports reviewing share price
movements and the Group’s performance against the sector. Detailed
market and shareholder feedback is also provided to the Board after
major public announcements such as results announcements. The
arrangements used to ensure that directors develop an understanding of
the views of major shareholders are considered as part of the annual
Board evaluation.
Corporate governance continued